Monday, November 28, 2016


Bloomberg reports that an investment and brokerage bank, CSC Financial Co. from Beijing, is looking to make a goodly debut as a public firm on the Hong Kong stock exchange, with an initial public offering of $1.06 billion put together with additional financing from one of its initial shareholders. The brokerage, formerly known as China Securities Finance Co., has been ranked 10 among the biggest securities firms in the PRC back in 2015.

In joint concert with the National Social Security Fund, CSC Financial are set to offer a grand total of 1.13 billion shares of stock, prized anywhere in the range of HK$6.36 to HK$7.26 per share.

According to deal terms made available to Bloomberg since Monday November 28, $597 million worth of the stock will be secured by cornerstone investors for 60% of the base deal size. When they begin offering stocks, CSC Financial could see it adding about $17.2 billion in share sales from first-time stock offers from financial firms this 2016. In a bid to build up funding to begin expanding internationally, CSC Financial and other domestic brokerages have gone to the HKSE to offer shares.

Shanghai-based Capital Securities Co. analyst Li Bin shares his opinion on this rising trend: “It’s part of their job as a state-owned enterprise to seek a listing as the country is opening up the capital markets. That will help CSC gain more market share in areas such as brokerage and margin financing, because the securities space in China is rather competitive.”

If things proceed as planned, then CSC Financial will begin taking orders from prospective investors from November 28 until the end of December 2. From the December 3-4 weekend they will give the share price and allocations, aiming to have them start trading shares by December 9.

In the same Top 10 ranking where CSC Financial brought up the last place, the Securities Association of China lists the three biggest brokerages as, in descending order, Citic Securities Co., Guotai Junan Securities Co. and Haitong Securities Co.

Appearing as joint sponsors of CSC Financial’s IPO are ABC International Holdings Ltd., China Securities International Finance Holding Co., and the UBS Group AG.

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