SHANGHAI – China International Capital Corp Ltd (CICC), the country’s oldest investment bank, will kick off its Shanghai public share sale on Wednesday (Oct 14), seeking to raise an estimated US$1 billion (S$1.35 billion) for expansion.
CICC, already listed in Hong Kong, is taking advantage of China’s capital markets boom to strengthen itself against growing foreign competition.
The eighth-biggest Chinese securities firm by assets said in an exchange filing that it will conduct price consultation with investors on Wednesday, and accept subscriptions on Oct 20, ahead of a Shanghai listing.
The secondary listing comes as China steps up restructuring its capital markets to fund economic growth and technological innovation amid heightened tension with the United States.
The government is also encouraging the formation of world-class Chinese investment banks amid rising competition after it fully opened the sector to foreign companies in April.
CICC said it expects “fierce” competition from foreign rivals who have advantages in global networks and capital strength.
“If we cannot supplement our capital strength … we face the risk of customer loss and market share shrinkage,” CICC said in the filing.
CICC shares rose nearly 3 per cent in morning trade in Hong Kong.
CICC plans to sell up to 458.59 million A-shares, or 9.5 per cent of its enlarged capital base. The offering could be worth over US$1 billion based on the latest price of CICC’s Hong Kong-traded stock.
CICC said it will use the fresh capital to invest in fintech and global expansion, and will also look for strategic acquisition opportunities.
The firm is a lead underwriter in the upcoming initial public offering of Chinese fintech giant Ant Group.
CICC was set up in 1995 as China’s first Sino-foreign investment bank venture that counted Morgan Stanley as a partner. Morgan Stanley exited CICC in 2010.