China Tower attracts Alibaba, Hillhouse to Hong Kong IPO
Jul 23, 2018 (China Knowledge) - China Tower Corp., a major state-owned wireless infrastructure operator, has attracted Hillhouse Capital and a unit of Alibaba Group Holding Ltd. as investors in its planned Hong Kong initial public offering, people with knowledge of the matter said.
'Yes and actually we are in the process of a road show with our name printed on the prospectus (of China Tower). We have invested USD 400 million as cornerstone investor…This(China Tower) is a special story, which is the reason why we invest.' A senior investment banker of Hillhouse Capital was quoted as saying when responding to requests by China Knowledge to confirm the relevant report by other news agencies.
Hillhouse funds and Taobao China Holding Ltd. are among the 10 firms that agreed to buy about USD 1.4 billion of stock as cornerstone investors, the people said. China Tower is expected to start taking investor orders Monday, said the anonymous source because the details are private. The planned deal could raise about USD 8 billion.
China Tower is pursuing what could be the world’s biggest IPO in almost four years amid weakening Hong Kong equity market these days, with the benchmark Hang Seng Index trading down 15% from its all-time high in January. This year's other hotly anticipated IPO -- Xiaomi Corp.'s USD 5.4 billion fundraising -- priced last month at the bottom of the range, valuing the phone maker at about half its original target.
Hillhouse funds and the Alibaba unit agreed to invest USD 400 million and about USD 100 million, respectively, in China Tower's IPO. Other cornerstone investors include affiliates of China National Petroleum Corp., SAIC Motor Corp. and Industrial & Commercial Bank of China Ltd., according to the people.
An USD 8 billion deal would be the world's biggest first-time share sale since Alibaba's USD 25 billion U.S. stock offering in 2014, according to data. China Tower is expected to price its offering around Aug. 1, the people said.
The world's largest telecom tower service was formed by combining tower assets of China Mobile Ltd., China Unicom Hong Kong Ltd. and China Telecom Corp. in 2015 as part of a broader plan to reform the nation's state-dominated wireless industry.
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