George Soros, billionaire and founder of Soros Fund Management. (Photographer: Jason Alden/Bloomberg)

Soros, Hillhouse Place Orders in $6.1 Billion Xiaomi IPO

(Bloomberg) -- Billionaire George Soros and Chinese investment firm Hillhouse Capital are seeking to invest in Xiaomi Corp.’s Hong Kong initial public offering, which aims to raise as much as $6.1 billion, people with knowledge of the matter said.

A Soros-backed fund placed an early order for a small amount of Xiaomi stock, according to one of the people, who asked not to be identified because the information is private. Hillhouse has placed an order of around $600 million, while U.S. asset manager Capital Group Cos. placed an order for more than $500 million of stock, the people said.

Xiaomi had attracted cornerstone investments from Qualcomm Inc. and China Mobile Ltd. for the deal, which was seeking to become the world’s biggest IPO in nearly two years based on the top end of the range. The smartphone maker, led by serial entrepreneur Lei Jun, is the first major tech listing in Hong Kong since the city changed its rules to allow founders to keep outsized voting rights.

The final price for Xiaomi’s share sale hasn’t been determined yet, and allocations to specific investors haven’t been set, the people said. Xiaomi is expected to price the offering Thursday evening in San Francisco hours, according to a message distributed earlier by the company’s IPO arrangers.

Representatives for Xiaomi, Hillhouse and Capital Group declined to comment. A representative for Soros Fund Management didn’t immediately respond to a request for comment.

Xiaomi has already had to scale back its ambitions for the offering. Top executives had initially pushed for an IPO valuation of as much as $100 billion when listing preparations began last year, Bloomberg News reported at the time.

The company was also planning to raise funds from mainland Chinese investors nearly simultaneously with the Hong Kong IPO. It has since delayed the plan to float so-called Chinese depositary receipts in Shanghai, which reduced its overall fundraising target.

Goldman Sachs Group Inc., Morgan Stanley and CLSA Ltd. are leading Xiaomi’s IPO as joint sponsors.

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