China’s Baidu to raise US$3.08b from Hong Kong listing

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HONG KONG – Chinese internet search giant Baidu is set to raise US$3.08 billion (S$4.14 billion) by pricing its shares at HK$252 (S$43.70) each in its Hong Kong secondary listing, according to two sources with direct knowledge of the matter.

New York-listed Baidu is selling 95 million shares as part of the transaction.

The people could not be named as the information has not yet been made public.

Baidu declined to comment on the pricing of the deal.

Baidu had previously flagged in its listing documents that the shares would be priced at no more than HK$295 ($38.02) each for retail investors and represent 3.4 per cent of its shares.

The of HK$252 is a 2.7 per cent discount to Baidu’s closing price of US$266.78 in New York on Tuesday (March 16) when its American Depository Shares rose 0.47 per cent. Baidu’s New York shares are 23.37 per cent higher so far this year.

One Baidu ADS is equivalent to eight of its Hong Kong shares, the listing documents showed.

The shares will start trading on the Hong Kong market on March 23.

Baidu is the latest Chinese company listed in the United States to carry out a so-called homecoming listing since Alibaba Group began the trend in November 2019.

There were 12 secondary listings in Hong Kong in 2020 that raised US$19.06 billion.

Dealmakers say the pipeline of future secondary listings remains strong in 2021, as US-listed Chinese companies await guidance on whether President Joe Biden would maintain plans outlined by his predecessor Donald Trump to delist them from U.S. stock exchanges if they don’t meet certain conditions.

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