Pacific Alliance Group, one of Asia’s biggest private equity firms, and DE Shaw, one of the world’s largest hedge funds, are the leading cornerstone investors for the $1.8bn Hong Kong listing of Haitong Securities, according to people familiar with the process.
Roughly one-third, or nearly $600m, of the deal for the Chinese brokerage business will be pre-sold to about 11 investors. The success of the listing will be crucial to kick-starting confidence in Hong Kong’s moribund initial public offerings market.
The market for new share sales has in effect been frozen since the $2bn sale of jewellery chain Chow Tai Fook last December. The only deal of any size to price in Hong Kong this year was the $575m Sunshine Oilsands listing, which fell more than 8 per cent in its first week, but is now just 1 per cent under its initial price.