Meituan edges up 1.5pc despite big cash call

Business | Reuters and Kevin Xu 21 Apr 2021

Meituan (3690) rose 1.52 percent to HK$293.60 yesterday in Hong Kong after the food delivery giant unveiled a US$10 billion (HK$78 billion) fundraising through a stock and convertible bonds sale.

Meituan raised US$6.6 billion by placing 187 million shares at HK$273.80, a 5.3 percent discount to the closing price on Monday, and gained roughly US$3 billion in two-tranche convertible bonds. Another US$400 million was raised by selling 11.35 million shares to Tencent at HK$273.80.

Tencent (0700) edged down 0.72 percent to HK$622.50 while the benchmark Hang Seng Index inched up 0.1 percent to 29,135 points. Travel stocks rose, fueled by the possible travel bubble between Hong Kong and Singapore in May.

In the currency market, the onshore yuan strengthened 162 basis points to 6.4953 per US dollar.

Meanwhile, China's market regulator is investigating a joint venture between e-commerce giant Alibaba (9988) and Minmetals Development, Minmetals said on Monday, amid a broad antitrust clampdown on internet firms.

Minmetals said in a statement that it received a notice from the State Administration for Market Regulation in recent days about an investigation into the joint venture formed in 2015, in which Alibaba transferred its 44 percent stake to an unrelated firm in 2019.

Alibaba declined to comment.

Yesterday, Minmetals said in a statement that according to its "preliminary understanding," the company's e-commerce cooperation "did not involve any violation of the anti-monopoly law, and there was no damage to the interests of customers, consumers, and investments."

In other news, Morningstar expects Macao's gross gaming revenue to rise 200 percent in 2021 from a low base a year ago, which is equivalent to about 65 percent of the pre-pandemic 2019 levels.

"We expect Macao GGR to extend its positive recovery trajectory sequentially in the coming quarters, and we think vaccinations will likely support further policy lifts, such as travel bubbles and easing of the Covid-19 test requirements. In addition, we remain upbeat for the coming May Golden Week, and believe both mainland China and Macao governments will take more efforts to support tourism," Morningstar said.

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