Home›Global Markets›Emerging Markets›Hong Kong IPO plans face delays as cornerstone backer…

Hong Kong IPO plans face delays as cornerstone backer enthusiasm fades

More than 60.0% of third-quarter Hong Kong IPOs are trading below their issue prices, and at least one October deal has been pushed to next month.

Reported · Written up by our desk · Emerging Markets

Exuberance among cornerstone investors in Hong Kong’s IPO market is fading, and some issuers are postponing deals they had expected to launch this month, according to people familiar with the situation cited by SCMP Economy.

The outlet said more than 60.0% of new listings in the third quarter are trading below their issue prices, which is causing cornerstone backers to reconsider whether to subscribe to upcoming offerings.

Cornerstone investors typically receive guaranteed allocations in exchange for holding shares for six months, but the article notes that some institutional investors have backed away from verbal agreements to act as cornerstone backers.

SCMP Economy added that at least one IPO originally planned for October was delayed until next month at the earliest after those pullbacks.

More like this

Sources