Xiaomi secures seven cornerstone investors for Hong Kong IPO of up to $6 bn

Chinese smartphone maker Xiaomi has lined up $548 million from seven cornerstone investors including US chipmaker Qualcomm for its Hong Kong IPO of up to $6.1 billion, according to a term sheet seen by Reuters.

Xiaomi, which also makes internet-connected devices, has set a price range of HK$17 to HK$22 ($2.17 to $2.80) each for its listing in the Asian financial hub, one of the biggest tech floats globally in recent years, showed the term sheet. Other cornerstone investors include Chinese express delivery company SF Express, domestic telecom service provider China Mobile, state-backed investment firm CICFH Entertainment and state-run conglomerate China Merchants Group.

The seven will take up a combined 10 percent of the shares being offered in the IPO, and the company has opened the book to intuitional investors on Thursday, according to the term sheet. 

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Xiaomi and China Mobile declined to comment. China Merchants Group, CICFH Entertainment, Qualcomm and SF Express did not immediately respond to requests for comment.

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The IPO values the Beijing-based, Cayman-domiciled company at $54.3 billion - or $70.3 billion after a 15 percent "greenshoe" or over-allotment option which can be sold if there is demand. If the greenshoe is exercised, Xiaomi's free float will be 9.99 percent of its enlarged share capital.