Citic Securities secures IPO investors

Citic Securities (601998.SH) has found cornerstone investors to buy more than half of the shares in its Hong Kong IPO scheduled for Friday, in which it plans to raise at least US$1.5 billion, the Wall Street Journal reported. Seven cornerstone investors, who receive guaranteed allotments in exchange for agreeing to hold shares for a certain length of time, have agreed to purchase US$900 million in shares, including Temasek Holdings, Kuwait Investment Authority, BTG Pactual, and Waddell & Reed (WDR.NYSE). The company has also secured an unusual promise from five bankers to “hard underwrite” the offering, or purchase unsold shares up to US$1.4 billion. In exchange, these five – ICBC International (601398.SH, 1398.HKG), CCB International (601939.SH, 0939.HKG), BOC International (601988.SH, 3988.HKG), Bocom International Securities (601328.SH, 3328.HKG) and Agricultural Bank of China International (601288.SH, 1288.HKG) – will have first access to the roughly US$10 billion IPO of Citic’s parent company, Citic Group, planned for next year.