HUATAI Securities has priced its London stock market listing at the bottom of its indicated price range in a deal that will help it to raise at least US$1.5 billion.

Shanghai-listed Huatai, one of China’s largest brokerages, is expected to make its London market debut today, becoming the first company to trade via the long-awaited London-Shanghai stock connect project.

Its listing on the London Stock Exchange will coincide with Britain and China holding the next round of their Economic and Financial Dialogue (EFD), with Chinese Vice Premier Hu Chunhua leading a Chinese delegation to London today.

Huatai sold 75 million global depositary receipts (GDRs) at US$20.50 each, representing 9.1 percent of its outstanding share capital, it said Friday.

The firm will also make available an additional 7.5 million GDRs through an overallotment, or greenshoe, option that could boost the deal value to US$1.7 billion. That would represent 82.5 million GDRs in total, or 10 percent of the group’s capital.

Huatai, which has a range of businesses including brokerage, wealth management and investment banking operations, had targeted a price range of US$20 to US$24.50 per GDR.

Chairman Zhou Yi said the deal “opens a gateway for international investors to share in the rapid development of China’s financial services market.”

Based in Nanjing, capital of China’s eastern Jiangsu Province, Huatai has driven a fourfold increase in revenue through a series of mergers and acquisitions between 2012 and 2018.

Huatai is valued at about US$21 billion through its Shanghai and Hong Kong listings, with the likes of BlackRock and Vanguard among its top investors in Asia.

A source close to the GDR sale said that the biggest orders for the London listing were placed by hedge funds, with other investors more cautious.

The listing, which was initially planned for December, has been delayed by uncertainty over how China would treat any currency conversion back into yuan, sources said. On May 27, China’s forex regulator published cross-border capital management rules on depository receipts, paving the way for Huatai’s London listing.

Other Chinese companies are expected to pursue similar moves, but several banking sources cautioned that it could take time to win over investors.

Huatai says it ranks as China’s fourth-biggest securities company in terms of net profit.

(SD-Agencies)