China Re raises $2 bn in HK IPO after pricing deal at top

China Re's IPO would be the largest in Hong Kong since Dalian Wanda Commercial Properties raised $4 billion in December

China Reinsurance (Group) raised $2 billion after pricing its Hong Kong initial public offering at the top of expectations, sources with direct knowledge of the plans told Reuters on Saturday.

The company priced the 5.77 billion new shares, equivalent to 13.7% of its enlarged share capital, at HK$2.70 each, after marketing the deal in an indicative range of HK$2.25 to HK$2.70, added the sources, who declined to be named because details of the IPO aren't yet public.

China Re's IPO would be the largest in Hong Kong since property developer Dalian Wanda Commercial Properties Co Ltd raised $4 billion in December. It should be surpassed next week when distressed debt manager China Huarong Asset Management Co Ltd prices its listing, worth up to $2.8 billion.

China International Capital Corp (CICC), HSBC and UBS were hired as joint sponsors on the IPO, with CCB International, Deutsche Bank, Morgan Stanley and Nomura also acting as joint global coordinators. There were also 12 other banks including Bank of America Merrill Lynch, BOC International and Citigroup acting as joint bookrunners.

The banks stand to jointly earn up to $50 million in commissions from the deal, equivalent to a 2% underwriting fee and a 0.5% discretionary commission, according to the offering prospectus.