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Akita Michinoku Capital Says SoftBank-Backed KE Aims to Raise $2.1 Billion in U.S. IPO

2020-08-13 18:10
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TOKYO--()--Analysts at Tokyo-based wealth management company Akita Michinoku Capital have said that the SoftBank and Tencent-backed Chinese online property platform, KE Holdings Inc. is aiming to raise $2.1 billion as it intends to price its U.S. initial public offering above its indicative share price range.

Head of Corporate Trading at Akita Michinoku Capital, Martin Thornton, said "KE were previously offering 106 million American depositary shares priced at $17 to $19 each, however, the company has now told potential investors that it will be pricing the shares at $20 apiece."

The above-range share pricing has highlighted the strong interest in the KE offering, which is expected to be the biggest U.S. float by a Chinese company since iQiyi Inc. raised $2.4 billion in March 2018.

"With the shares priced at $20 each, KE, also known as Beike Zhaofang, has a company valuation of $22.5 billion, based on the outstanding shares listed in its filings. This marks a success for SoftBank, which invested $1.3 billion when the company was valued at $10 billion," said Oliver Wright, Director of Corporate Equities at Akita Michinoku Capital.

Despite the rising tension between the two biggest economies in the world and an accounting scandal at a U.S.-listed Chinese start-up earlier this year, companies from the Asian nation have enjoyed a warm welcome from U.S. investors. Last month, Chinese electric-vehicle start-up Li Auto Inc. raised $1.1 billion in a U.S. IPO with its shares also priced above-range.

Beijing Homelink Real Estate Brokerage Co., also known as Lianjia, is one of China's leading real estate companies. In 2018, it launched Beike as its online property brokerage platform. Last year, Beike which means ‘shells’ in Chinese, raised around $800 million from Tencent as part of a funding round. China Renaissance Holdings Ltd. has also invested around $860 million in the business.

According to data collected by Akita Michinoku Capital, the offering is being led by Goldman Sachs Group Inc., Morgan Stanley, China Renaissance and JPMorgan Chase & Co. Starting on Thursday, KE intends to sell shares on the New York Stock Exchange under the ticker BEKE.

About Akita Michinoku Capital

Established in 2009, Akita Michinoku Capital is a respected wealth management company with a global network reaching over 40+ countries. By uniting financial markets from East to West, we can support our clients through all facets of wealth management and provide our clients with the best possible investment performance through a broad range of investment products.

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