Chinese electric vehicle maker Leapmotor launches up to $1 billion Hong Kong IPO


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HONG KONG, Sept 20 (Reuters) – Chinese electric vehicle maker Zhejiang Leapmotor Technology is aiming to raise $1.03 billion in a Hong Kong initial public offering (IPO), regulatory filings show, which would be the important part of the city in 2022.

The company is selling 130.82 million shares under the deal which will be sold within a price range of HK$48 to HK$62 each, according to filings.

Leapmotor’s deal comes as China Vanke’s real estate services group Onewo Space-Tech Service is on the market to raise up to $733 million in its IPO which launched on Monday. Onewo had hoped to raise $2 billion but scaled back the size of its IPO. Read more

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The two deals are the biggest in Hong Kong since February and dealmakers hope a positive response could spur more IPOs before the end of the year.

Bankers and lawyers remain pessimistic about a major rebound in IPOs as Sino-US tensions remain elevated, the Russia-Ukraine war still rages and inflation remains stubbornly high in most parts of the world.

Leapmotor had planned to raise $1.5 billion but scaled back the size of the deal after a lukewarm response from investors, sources previously told Reuters. Read more

The IPO was halted a fortnight ago after the company’s initial briefings with potential investors amid volatile financial markets, the sources said.

The company will have a market capitalization of $6.99 billion to $9.03 billion based on the price range reported to investors.

The final share price is expected to take place on Friday and the stock will begin trading on September 29.

Leapmotor has locked in five high-profile investors — led by industry funds Zhejiang and Jinhua — who will buy up to $308.33 million worth of shares, according to filings.

Leapmotor produces four electric vehicle models that mainly target China’s mid-range and low-end mass market in the price range of 79,500 yuan to 300,000 yuan ($11,466.40 to $43,269.44), according to its website and its prospectus filed with the Hong Kong Stock Exchange.

The company was ranked 12th in sales in the first seven months among all electric vehicle makers in China, with a 2.3% market share, according to data from the China Passenger Car Association.

The majority of funds raised will be used for research and development and expansion of production capacity, according to filings.

($1 = HK$7.8488)

($1 = HK$7.8488)

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Reporting by Scott Murdoch in Hong Kong; Editing by Kim Coghill and Stephen Coates

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