Citic Securities Co raised HK$13.2 billion ($1.7 billion) in Hong Kong's biggest public stock offering in more than three months, two people with knowledge of the matter said on Wednesday.

The mainland's biggest brokerage by market value sold 995.3 million shares at HK$13.30 apiece, said the people, who declined to be identified because no announcement has been made.

The stock was initially offered at HK$12.84 to HK$15.20 before banks managing the sale raised the low end of the range to HK$13.30, they said.

Citic Securities' sale is the biggest in Hong Kong since Italian fashion retailer Prada SpA raised $2.5 billion in June.

The benchmark Hang Seng Index is down 20 percent since June and the value of initial public offerings in the city has fallen by 64 percent from the previous quarter amid Europe's escalating sovereign debt crisis.

"With a lot of uncertainties surrounding EU countries, investors are reluctant to put their money to work," said Victoria Mio, a Hong Kong-based fund manager at Robeco, whose fund subscribed to the offering.

Citic securities closed down 2.46 percent at 11.52 yuan in Shanghai trading on Thursday with the Hong Kong offering price at a 5.4 percent discount to that level.

The sale could prove a one-off case, Mio said. "They put money in this one because Citic is a leader in one of the growing brokerage markets where the capital market is continuing to open up."

The final price values Citic Securities at 1.28 times estimated 2011 book value and 8.95 times forecast 2011 earnings, one of the people said. Sukyi Yau, a Hong Kong-based outside spokeswoman for Citic Securities, declined to comment on the final pricing.

Bloomberg

(HK Edition 09/29/2011 page2)