Shangdong International Trust issues Hong Kong IPO worth up to $450mn

On Monday, Shangdong International Trust (SIT) issued an IPO in Hong Kong, offering 647mn shares.

It will charge between $0.57-0.70 per share and could raise a total of $450mn.

SIT will be the first Chinese trust since 1994 to list on the Hong Kong Stock Exchange.

The company is backed by Shangdong’s government and was ranked 25th among China’s 68 trust firms. In 2016 the company boasted assets of $38.6bn.

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Earlier this year the firm made a failed attempt to list. Analysts feel the failure may have been due to its holdings in Century Plaza Hotel, which was forced to delist from the Shenzhen market in 2017, a regulatory warning it received for allegedly assisting local governments in “irregular debt financing,” and a fine imposed on the company for failing to disclose information to trust beneficiaries in a timely manner.

A Hong Kong IPO may be a better choice for the trust company since A-share listings are scrutinised heavily by regulators in mainland China.

According to chairperson Wang Yingli: “Hong Kong has been our destination since the beginning… we want to expand our international business. Hong Kong is an open, international market and the best platform for us to go public.”