China Life to float 1.5b A-shares
By Zheng Lifei (China Daily)Updated: 2006-12-20 13:59 China Life Insurance Co, the country's largest life insurer, is planning to sell as many as 1.5 billion local currency A shares to boost its capital.
The Shanghai listing would make China Life the first domestically listed insurer.
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The proceeds from the IPO will be used to replenish its capital "or channel it for other purposes that are approved by regulators," the company said in its prospectus.
The Beijing-based insurer said yesterday it would start consultations with investors to determine the share price.
An indicative price will be announced on Friday and the final price and results of the share offer will be determined Thursday next week, the insurer said in the prospectus.
China Life's Hong Kong-listed H shares, which have soared more than three times since the beginning of this year, closed at HK$22.05 (US$2.83) yesterday, down 2.86 per cent.
If the A shares are priced at that level, the IPO could raise over 32 billion yuan (US$4 billion), making it the second biggest domestic IPO this year. The share offer, analysts say, is widely expected to be priced at a discount of around 10 per cent to the H shares, a move aimed at ensuring its success.
China Life, which is also listed in Hong Kong and New York, plans to allocate about 40 per cent of the shares to strategic investors, with 22.5 per cent slated for institutional investors and the remaining shares for retail investors.
But some of the institutional allocation may be shifted to the retail portion if demand there is particularly strong, the life insurer said yesterday.
China Life, now the world's third-largest insurer by market value, may begin
trading its shares on the Shanghai Stock Exchange on January 11 at the latest, according
to Shanghai Securities News reports.
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