|
Vale Hong Kong IPO
|
Undisc. | |
|---|---|---|
| Synopsis Brazil’s mining giant Vale launches IPO on the Hong Kong Stock Exchange | ||
| Firm | Client | Role |
|
Norton Rose
|
Issuer
|
Hong Kong counsel |
|
Mattos Filho, Veiga Filho, Marrey Jr e Quiroga Advogados
|
Issuer
|
Brazilian counsel |
|
Cleary Gottlieb Steen & Hamilton
|
Issuer
|
US and French counsel |
|
Paul Hastings
|
Sponsors
|
Hong Kong and US counsel |
|
Machado, Meyer, Sendacz e Opice Advogados
|
Sponsors
|
Brazilian counsel |
2010 has already been an exciting year for the Hong Kong Stock Exchange (HKSE): the first two non-Asian company listings (Russian Rusal’s US$2.24bn IPO in January and French L’Occitane US$708m IPO in May) have already taken place.
Now Brazil’s Vale, the world’s largest iron ore producer and second largest diversified mining company, is set to join the bandwagon. The company has engaged a list of legal advisors including Norton Rose and Cleary Gottlieb to advise on its Hong Kong float, which will use Hong Kong depositary receipts and so offer investors the added convenience of being able to buy a Brazilian company through a Hong Kong dollar-denominated instrument.
According to Vale’s chief financial officer Guilherme Cavalcanti, the key reasons for the company to list in Hong Kong are to raise its profile in Asia – specifically to get closer to its Chinese investors – and to broaden its shareholder base. In 2009, 57% of its revenue came from Asia, including 37.6% from China – its single largest market.
The company is also a large buyer of machinery, mining and power generation equipment, and ships from China, and it has made substantial investments in China, setting up several JVs with mainland partners. Its business ventures in China also includes a recent US$1.2bn loan (used to finance the construction of 12 vessels that will be used to transport iron ore from China to Brazil) from Export-Import Bank of China and Bank of China, a deal that was advised by King & Wood, Machado Meyer Sendacz Opice and Norton Rose.
Cleary Gottlieb is Vale’s long-term legal advisor – the firm represented the company in its US$940m convertible bonds offering in the US last year. Spurred by its clients’ new-found vision for the Asian market, the firm is launching a Hong Kong law capability and consequently has hired Norton Rose’s corporate finance head Freeman Chow to lead the change.
In anticipation of more non-Asian listings in Hong Kong, other US counterparts like Milbank Tweed, Shearman & Sterling and Davis Polk have all also launched Hong Kong law capabilities this year. ALB
Related stories:
- Race for Hong Kong law capability drives partner-poaching (7 December 2010)
- Firms advise on first Russian HKSE listing (8 February 2010)