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ZTO Express Raises $1.27 Billion in Hong Kong Listing

ZTO Express Raises $1.27 Billion in Hong Kong Listing

Chinese courier service giant ZTO Express Cayman Inc. and drug developer Zai Lab Ltd. raised a combined HK$15.7 billion ($2 billion) in their second listings in Hong Kong, according to people familiar with the matter, adding to the flurry of share sales in the financial hub by U.S.-traded firms from the Asian nation.

ZTO Express has raised $1.27 billion after pricing its offering of 45 million shares at HK$218 each, the people said, asking not to be identified as the information is private. The price represents a discount of about 2% to its closing price of $28.68 on Monday in New York amid a broad equity selloff.

Biopharmaceutical company Zai Lab raised $766 million after pricing its sale of 10.56 million shares at HK$562 each, the people said. That amounts to a discount of about 1% to its New York closing price of $73.3 on Monday.

External representatives for ZTO Express and Zai Lab declined to comment.

The two firms are joining a growing cohort of New York-traded companies from China in looking to establish a trading foothold in Hong Kong as relations between Washington and Beijing come under significant strain. U.S. regulators are threatening to restrict Chinese firms’ access to American capital markets if the companies do not allow authorities to review their audits, escalating an issue that has vexed them for over a decade. E-commerce services provider Baozun Inc., is due to become the third company this week to price a sizable Hong Kong listing as it seeks as much as $536 million.

Hong Kong’s stock exchange is benefiting from the trend. Some $10.6 billion has been raised from the “homecoming” listings this year of companies including JD.com Inc. and Yum China Holdings Inc., and more are in the pipeline. The offerings of ZTO Express and Zai Lab are hitting the market before the mammoth IPO of Jack Ma’s Ant Group which could raise at least $35 billion through simultaneous listings in Hong Kong and Shanghai, soaking up massive amounts of liquidity, Bloomberg News reported on Monday.

Zai Lab’s shares will debut in Hong Kong on Sept. 28. Shares of ZTO Express will start trading in Hong Kong on Sept. 29.

Goldman Sachs Group Inc. is the sole sponsor for the ZTO Express listing, while UBS Group AG, China International Capital Corp. and Citigroup Inc. are joint bookrunners.

JPMorgan Chase & Co., Goldman Sachs and Citigroup are leading Zai Lab’s offering as joint sponsors, along with joint global coordinator Jefferies Financial Group Inc.

©2020 Bloomberg L.P.