PCCW Hong Kong IPO raises USD1.2bn, below original expectations

24 Nov 2011

Hong Kong telecoms group PCCW, has raised around HKD9.3 billion (USD1.2 billion) in its initial public offering of its core telecoms business, which is being spun off into a business trust and listed on the local stock market. The amount raised by HKT Trust was below the company’s original target of USD1.6 billion. Britain’s Financial Times writes that the Hong Kong offering was priced at the bottom end of its indicative range, at HKD4.53 per ‘unit’ (held by business trust investors instead of shares), ‘amid market volatility and weak retail demand’. PCCW chairman Richard Li bought 12.6% of the issue, far more than he had publicly indicated he would, although the newspaper’s financial sector sources added that there had been good institutional investor interest. HKT Trust will become the first business trust – a hybrid of unit trusts and conventional equities – to be listed in Hong Kong, after Li threatened to take the IPO to Singapore instead, where stock market regulations had previously been changed to allow such company structures. Alex Arena, managing director of PCCW, was quoted as saying of the IPO result: ‘Despite the very challenging macroeconomic environment and financial markets during the roadshow, [HK Trust] has attracted a broad list of globally-renowned institutional investors.’

Hong Kong, HKT (incl. CSL), PCCW Group, PCCW Mobile (formerly Sunday Communications)