By Scott Murdoch
(Reuters) -Chinese battery manufacturer CATL aims to raise at least HK$31.01 billion ($3.99 billion) in its Hong Kong listing, according to its prospectus filed on Monday, the largest listing globally so far in 2025.
The electric-vehicle battery maker is selling 117.9 million shares at a maximum offer price of HK$263 per share, according to filings lodged with the Hong Kong Stock Exchange.
The size of the deal could increase to about $5.3 billion if an offer size adjustment option and a so-called greenshoe option are exercised.
CATL’s shares in Shenzhen rose 3.6% on Monday after the Hong Kong deal was launched, reaching a six-week high. The gain outpaced a 0.9% lift in China’s blue-chip CSI300 index.
CATL raising $4 billion means the listing is the biggest in the world so far this year, according to Dealogic data, beating JX Advanced Metal’s $3 billion March IPO in Tokyo.
In Hong Kong, the share sale will be the largest since Midea Group raised $4.6 billion last year.
More than 20 cornerstone investors, led by Sinopec and Kuwait Investment Authority, have subscribed to buy about $2.62 billion worth of CATL shares, the prospectus showed.
The order book for the institutional tranche of 109.1 million shares has already been covered with demand from investors, according to two sources with direct knowledge of the matter. The sources could not be named discussing information that was not yet made public.
CATL did not immediately respond to a request for comment on the demand.
The offer size adjustment option means the number of shares could be increased by up to 17.7 million shares to raise up to an additional HK$4.65 billion ($598.00 million). There is a greenshoe option to sell a further up to 17.7 million shares.
The shares are due to price between Tuesday and Friday, with the final price to be announced on or before May 19, the filings showed.
There will be 8.8 million shares available for Hong Kong’s retail investors to bid for, the prospectus showed.
The company said about 90% of the proceeds raised, about HK$27.6 billion, would be spent on the construction of its planned Hungary factory, part of its plan to make batteries in Europe for automakers such as BMW, Stellantis and Volkswagen.
The first phase of the factory, in which it is investing 2.7 billion euros ($3.03 billion), is due to start producing batteries this year. It aims to begin construction on the second phase later this year.
CATL’s Hong Kong shares will be sold at a small discount to the Shenzhen stock’s closing price on Friday if the shares price at HK$263 each and are due to start trading on May 20.
The prospectus said CATL was granted a Hong Kong Stock Exchange waiver to not publish a minimum price the shares could be sold at as it could impact the trading of its Shenzhen-listed stock.
CLOSE EYE ON US-CHINA TRADE WAR
U.S. onshore investors will not be able to buy CATL shares in the Hong Kong deal, the filings showed, but many of those funds have offshore operations that would be able to participate.
The company was placed on a U.S. Defense Department list in January of Chinese companies it says work with China’s military. CATL said in its prospectus it was working with the U.S. department to address the ‘false designation’.
“It does not restrict us from conducting business with entities other than a small number of U.S. governmental authorities, thus is expected to have no substantial adverse impact on our business,” it said.
CATL’s book building comes as the U.S. and China hailed constructive talks in Geneva on the weekend towards de-escalating their trade war, but Washington’s 145% tariff on Chinese goods and Beijing’s 125% tariff on U.S. goods remain in place.
“Tariff policies have been rapidly evolving. Currently, we cannot accurately assess the potential impact of such policies on our business, and we will closely monitor the relevant situation,” CATL’s prospectus said.
($1 = 7.7759 Hong Kong dollars, 7.2364 Chinese yuan renminbi, 0.8906 euros )
(1 Hong Kong dollar = 0.9306 Chinese yuan)
(Reporting by Himanshi Akhand in Bengaluru, Scott Murdoch in Sydney. Additional reporting Brenda Goh and Zoey Zhang in Shanghai; Editing by Sumeet Chatterjee, Leslie Adler, David Gregorio and Sonali Paul)
