HONG KONG—One of China’s top lithium producers has launched what is expected to be Hong Kong’s biggest initial public offering so far this year, in a recent bid to test global investor appetite for shares of new-energy companies. Facing market volatility.
tianqi lithium Corporation
002466 -1.01%
The target is to raise more than $1 billion in listing on Hong Kong’s stock exchange, according to people familiar with the matter. The Chengdu, China-based company, which it says is one of the world’s largest producers of battery-grade lithium compounds, has been listed in Shenzhen since 2010. Its mainland shares have more than doubled in value in the past 12 months, giving it a market share. According to FactSet, a capitalization of approximately $26 billion.
The company filed a revised prospectus on June 19, after passing a listing hearing in Hong Kong and gaining approval from China’s securities regulator to sell shares in the first Asian financial hub. It is expected to price its IPO on July 6 and begin trading on July 13, people familiar with the deal said. The final deal size may change based on investor demand.
Tianqi Lithium is trying to do a big fundraising At a time when global demand for IPOs has declined, Rising US inflation, rapidly rising interest rates, Russia’s invasion of Ukraine and uncertainty about the global economic outlook have helped fuel a global stock sell-off, which has dented new stock-issue volumes.
Hong Kong market has been hit especially hard, In the year-over-year period, the companies raised a total of $2.4 billion in new and secondary stock listings in the city, according to Dealogic data, up more than 90% in value from the same period a year ago.
Tianqi Lithium, which has been in business for nearly 30 years, manufactures lithium compounds and derivatives in China and owns and mines lithium minerals in Australia, according to its prospectus. The metal is used in rechargeable batteries and has been In demand for electric-vehicle production, It is also used to make glass, ceramics and other types of derivative products.
The company had previously applied for listing in Hong Kong in 2018 and was aiming to raise a similar amount at the time to help pay for the minority stake it had bought that year in a year. Chile-based lithium production and distribution company known as SQM. known as, The IPO ended, even though it got the green light from the China Securities Regulatory Commission.
Proceeds from the upcoming share sale in Hong Kong will be used to pay off debt that Tianqi Lithium still has from that $4 billion Chilean mining deal, as well as lithium in the Anju district of China’s Sichuan province. Funds will be given for the construction of carbonate manufacturing plant. ,
Shenzhen-listed shares of Tianqi Lithium and one of its main rivals,
ganfeng lithium Co.
The broader Chinese stock has outperformed the market over the past two years, thanks in part to increased demand for the compounds they produce.
Tianqi Lithium’s revenue more than doubled to $1.13 billion in 2021 and the company reported a profit of $626 million, swinging from a loss of $167 million a year earlier.
—Cao Li contributed to this article.
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