China Life Insurance raised 23.5 billion Hong Kong dollars $3 billion amid frenzied demand for the world's largest IPO this year, sources said this morning.
Investors ordered about 25 times more shares of China's biggest life insurer than were available amid a rally in China-related stocks and renewed appetite for initial public offerings.
Orders from big institutions topped $50 billion as investors clamoured for a piece of China's 8 per cent-plus economic growth and surging domestic consumption fuelled by the country's increasing wealth.
Small Hong Kong investors, who queued outside bank branches this week to apply for shares in an IPO frenzy last seen during the dot-com days, committed roughly 200 billion Hong Kong dollars in hopes of landing coveted shares.
China Life Insurance shares will begin trading in New York on December 17th under the code LFC and the next day in Hong Kong as stock number 2628.
The company sold some 6.47 billion shares at 3.625 Hong Kong dollars apiece, at the top end of the 2.98 Hong Kong dollars to 3.65 Hong Kong dollars per share range, raising 23.5 billion Hong Kong dollars. Since the insurer was selling a quarter of its enlarged share capital, the IPO price valued the company at about $12 billion.
Investors, emboldened by big day-one gains of recent Chinese IPOs in the city, are ignoring talk of a China bubble forming and the risks associated with China's creaky financial sector.