Xiaomi starts taking orders for up to US$6.1b Hong Kong IPO

[HONG KONG] Xiaomi Corp started taking orders for the world's biggest initial public offering (IPO) in nearly two years, aiming to raise as much as US$6.1 billion in Hong Kong.

The Chinese smartphone maker and existing investors are offering 2.18 billion shares at HK$17 to HK$22 apiece, according to terms for the deal obtained by Bloomberg on Thursday. The price range values Beijing-based Xiaomi at US$53.9 billion to US$69.8 billion, assuming a so-called over-allotment option isn't exercised, the terms show.

China Mobile, the nation's biggest wireless carrier, and US wireless-chip giant Qualcomm Inc are among firms that have agreed to buy stock as cornerstone investors. Xiaomi expects to take orders from institutional investors through June 28 and aims to start trading in Hong Kong July 9, according to the terms.

Xiaomi, led by serial entrepreneur Lei Jun, was the first to file for a Hong Kong IPO with a weighted-voting rights structure after the city's bourse changed its rules in April. The deal could become the world's biggest first-time share sale since September 2016, when Postal Savings Bank of China Co raised US$7.6 billion in a Hong Kong IPO, data compiled by Bloomberg show.

CLSA, Goldman Sachs Group Inc and Morgan Stanley are leading Xiaomi's Hong Kong IPO as joint sponsors.

Xiaomi was earlier planning to seek about US$10 billion combined from the Hong Kong IPO and a near-simultaneous offering to mainland Chinese investors. It has since delayed its plan to float so-called Chinese depositary receipts in Shanghai, which was part of the government's long-term goal of getting its biggest technology firms to list locally.

BLOOMBERG