Insurer New China Life to raise $2.3-bn in Hong Kong, Shanghai IPO

New China Life Insurance Co, China's fourth-largest life insurer by premiums, plans to raise $2.3 billion in an initial public offering (IPO) in Hong Kong and Shanghai.

The Beijing-based insurer is offering 358.4 million shares at HK$28.20 ($3.62) to HK$34.33 each in the Hong Kong listing of the IPO and 158.5 million shares in Shanghai at a price band of 23 yuan to 28 yuan per share.

The company plans to raise up to $1.58 billion from its Hong Kong IPO and $696 million from the Shanghai IPO. With the over-allotment option to increase the deal size by 15 per cent, the Hong Kong IPO could go go up to $1.8 billion.

It plans to start trading in Hong Kong on 16 December, according to the term sheet.

According to an 11 November filing, New China Life's biggest shareholders are Central Huijin Investment Ltd, an arm unit of China's sovereign wealth fund, holding 38.8 per cent stake, Zurich Insurance Co, a unit of Zurich Financial, is the third-biggest investor with a 15 per cent stake.

The insurer has received commitments from four cornerstone investors for $780 million worth of shares in the Hong Kong tranche of its IPO, International Financing Review (IFR), the world's leading source of capital markets intelligence, yesterday reported, citing two sources with direct knowledge of the deal.

Singapore's Great Eastern Holdings Ltd has committed to buy $380 million worth of H-shares, while hedge fund D E Shaw and Malaysian state investor Khazanah Nasional Bhd have each committed $150 million. South Korean private equity firm MBK Partners will buy $100 million worth of shares, IFR added.