Budweiser's $76b IPO cup overflows

Business | Avery Chen 9 Jul 2019

Budweiser Brewing Company APAC, the largest brewer in the Asia Pacific backed by Anheuser-Busch InBev, has received full subscription in the institutional tranche of its Hong Kong initial public offering that could raise up to HK$76.45 billion.

Five local brokers have lent more than HK$8.63 billion margin financing for the world's largest deal so far this year, equivalent to about 1.3 times oversubscription in the retail tranche.

The brewer is offering 1.63 billion shares at an indicative offering price range between HK$40 and HK$47. Given that one board lot is 100 shares, the minimum investment is HK$4,747.36.

The IPO will be priced on Thursday and trading of shares will kick off on July 19.

In other IPO action, IVD Medical, a Chinese distributor of in-vitro diagnostics, has raised HK$1 billion from its Hong Kong floatation. The company will debut on Friday.

Also, the books are covered for mainland bank Jinshang Bank's Hong Kong IPO of up to HK$3.4 billion, and mainland property developer Zhongliang's international placing tranche was fully subscribed.

In other news, Chris Leung Shiu-kay, executive director and chief China economist of DBS Bank Hong Kong said the high Hong Kong Interbank Offered Rate was due to the mega IPO and not related to an outflow of funds on concerns of political unrest.

He said local banks may lower prime rates if the United States cuts interest rates twice this year and the Hibor drops significantly. The Hibor fell from 10-year highs yesterday, with the one-month Hibor, a benchmark for mortgage rates, down 29.46 basis points to 2.685 percent, and the overnight Hibor declining 82.18 basis points to 2.2296 percent.

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