China Pacific gets nod for public float

By Wang Bo (China Daily)
Updated: 2009-11-28 07:27

China Pacific Insurance Co Ltd on Friday got the green light from Hong Kong Stock Exchange for its $3.4 billion share float in Hong Kong.

The company has wrapped up the regulatory inspection process and is likely to launch the road show as early as next week in order to get listed before the end of the year, the Shanghai-based Oriental Morning Post reported.

The nation's third largest life insurer received approval from China's top securities regulator on Wednesday and would list no more than 990 million shares in the overseas market, it said in a statement filed to the Shanghai Stock Exchange.

China Pacific gets nod for public float
The insurer had suspended its IPO plans last year. [Jiang Ning]

"The Hong Kong listing will help the company step up its business expansion and compete with bigger domestic rivals like China Life and Ping An," Zhao Xinan, a Shanghai-based analyst with Northeast Securities said.

The Shanghai-listed shares of China Pacific closed at 23.84 yuan on Friday, down 4.3 percent from the last trading session, mirroring the recent bearish trend of the Shanghai bourse.

"It is understandable that the insurer's A shares danced with the general downtrend of the stock market, as investors have largely priced in the IPO news," Zhao said.

China Pacific, partly owned by American private equity firm Carlyle Group, said in August that it expected to price its H share at around 23.5 yuan, and plans to raise around 23.5 billion yuan from its Hong Kong listing.

In the first three quarters, the insurer reported a net profit of 4.1 billion yuan, up 4.8 percent from a year earlier, while revenue reached 81.4 billion yuan, down 1.1 percent from a year ago.

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The insurer, which had suspended its Hong Kong IPO plans last year due to the depressed stock market, has joined a number of other domestic companies in pursuing fundraising opportunities in Hong Kong stock market this year, which rallied nearly 50 percent since the beginning of 2009.

China Minsheng Banking Co, which saw its shares become tradable on Thursday, raised about HK$30 billion in Hong Kong's biggest IPO since April 2007. However, its shares fell 4.5 percent after its debut, beating market expectations.

The stock market has shown signs of strain due to the massive fund raising activities this year, analysts said.