Rocky global markets and the worsening euro zone debt crisis did not deter China’s brokerage giant and investment bank Citic Securities from going ahead with its $1.7 billion Hong Kong listing in early October, the city's third-largest IPO of the year despite a weak start.
Citic Securities, the brokerage arm of China’s first state-backed conglomerate Citic Group, engaged Jiayuan Law Firm on PRC law, and retained Baker & McKenzie and Latham & Watkins as its Hong Kong and U.S. counsels respectively.
Citic Securities was the sole global coordinator of its worldwide offering, and a slew of banks including Bank of China International, China Construction Bank International, Bank of America Merrill Lynch and CLSA underwrote the transaction, with the latter group engaging King & Wood as their PRC legal advisor and Freshfields Bruckhaus Deringer as their counsel on Hong Kong and U.S. law.
The company plans to use about 65 percent of the proceeds raised by the global offering to acquire and set up research platforms, and sales and trading networks; and set aside another 30 percent of the funds to develop flow-based business such as prime services, structured products, fixed income, foreign exchange and commodities trading for hedge funds.
Citic Securities’ H-shares float bucked the recent trend of tepid investor receptions for mainland firms like tea producer Tenfu and shoe manufacturer Hongguo, and was also one of the few new listings on a Hong Kong bourse which has seen a severe slowdown in IPO activity of late.
The Baker & McKenzie team was headed by securities partners Chik Pui-hong and Rossana Chu in its Beijing and Hong Kong offices respectively. The American firm was responsible for legal documentation, drafting of the Hong Kong sections of the prospectus, corporate and regulatory matters and general transaction management. ALB
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