Thursday 26 November 2020 9:02 am

Evergrande Property ‘prices at lower end’ in $1.8bn Hong Kong IPO

Evergrande Property Services Group – part of China’s second-biggest property developer – reportedly achieved the lower end of expectations to raise $1.8bn in its major Hong Kong IPO.

The public offering priced at HK$8.80 (85p) per share, according to sources who spoke to Reuters. The marketed range was HK$8.50 to HK$9.75.

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It comes with Evergrande – which is heavily indebted – searching for cash amid a crackdown on excessive borrowing in China’s property development sector.

The group last month raised just half of its initial target in a secondary share sale. Shares in China Evergrande have fallen more than 20 per cent this year amid concerns about pressures on the company and industry.

Evergrande has been contacted for comment about the Property Service Group IPO.

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The sale at HK$8.80 per share is around a five per cent increase on a private funding round in August, when shares were issued at HK$8.375. It means Evergrande Property is valued at HK$95.06bn.

Reuters reported that half the funds raised in the sale will go to the company. The other half will go to the parent firm.