HONG KONG: Chinese property firm Onewo Space-Tech Service is launching Hong Kong’s largest initial public offering (IPO) of 2022 as it aims to raise up to HK$6.15bil (US$783.54mil or RM3.55bil), regulatory filings show.

The company, a division of developer China Vanke Co Ltd, has set a price range of HK$47.1 to HK$52.7 a piece for the sale of 116.74 million shares.

The shares represent 10% of Onewo’s share capital, according to a term sheet and the price range values Onewo at US$7bil to US$7.8bil .

Companies have raised just US$2.42bil in IPOs in Hong Kong in the year to date, Refinitiv data showed, versus US$23.76bil in 2021, following a year of China-United States tension and a tightening regulatory environment in China.

Onewo’s transaction will become Hong Kong’s largest IPO this year, eclipsing that of Huitongda Network Co Ltd which raised US$297mil in February.

The two largest deals in Hong Kong this year, China Tourism Duty Free Corp’s US$2.1bil share sale and Tianqi Lithium’s US$1.7bil sale, were secondary listings in mainland China.

China Vanke, the country’s second-largest property developer by sales, owns 62.9% of Onewo, Onewo’s regulatory filings showed.

The size of the deal was scaled back after Onewo had hoped to raise up to US$2bil as global financial markets remain volatile, people with knowledge of the matter previously told Reuters.

The Hang Seng property services and management index is down 44.3% in 2022, as a result China’s property sector weakness.

Onewo said it has six cornerstone investors, led by China’s Mixed Ownership Reform Fund, China Chengtong Investment and UBS Asset Management, which have subscribed for up to US$280mil worth of the shares on sale.

A final price for the sale will be set on Thursday and public trading of the shares is due to start on Sept. 29.

 - Reuters