By Scott Murdoch
(Reuters) -Chinese drug developer and producer Jiangsu Hengrui Pharmaceuticals is aiming to raise up to HK$9.89 billion ($1.27 billion) in a Hong Kong listing, according to a regulatory filing made on Thursday.
The deal will be the second in Hong Kong to raise above $1 billion in the past week, as the city’s sluggish listings and initial public offering (IPO) markets start to show signs of revival.
Chinese battery maker CATL on Wednesday indicated it would price its Hong Kong shares at HK$263 each, at the top of the indicated range to raise about $4.6 billion.
Hengrui will sell the shares between HK$41.45 and HK$44.05 per share, according to a prospectus filed by the company to the Hong Kong Stock Exchange.
Seven cornerstone investors have subscribed for about $533 million worth of Hengrui stock, led by Singapore sovereign fund GIC which is taking about $268 million worth of the deal, the filings showed.
Hengrui plans to offer 224.5 million shares in the listing, which includes 12.3 million shares allocated for Hong Kong retail investors.
Hengrui plans to use about 45% of the money raised in the listing to fund clinical studies for its innovative drugs and drug candidates and 20% for developing new innovative drugs, according to its prospectus. The remainder will be spent on potential acquisitions, collaborations and construction of new production and research facilities in China and overseas.
Hengrui shares are due to start trading on the Hong Kong Stock Exchange on May 23, the filing said.
Hengrui’s Shanghai listed stock rose 0.9% to 53.38 yuan, the highest level since October following the Hong Kong deal’s launch.
Before CATL’s deal, there had been almost $3 billion worth of initial public offering and secondary listings in Hong Kong this year, according to LSEG data, up 137% on the same time last year. It is the strongest start to the year since 2021, helped by relaxed listing rules and improved global investor sentiment.
($1 = 7.8042 Hong Kong dollars)
(Reporting by Scott Murdoch in Sydney; additional reporting Roshan Thomas in Bengaluru; Editing by Alan Barona and Lincoln Feast.)
