By Prudence Ho And Yvonne Lee
HONG KONG—Japan's SBI Holdings /zigman2/quotes/200067066/delayed JP:8473 -4.02% Inc. hopes to raise between US$300 million and US$500 million from offering shares of its financial unit in both Hong Kong and Japan, said people familiar with the matter, which would mark the first time a Japanese company offered shares in the Chinese territory.
The listing—and new efforts by Chinese companies seeking to raise a combined US$2 billion—suggests the go-go market for initial public offerings that powered Hong Kong's fund raising last year is continuing into this year.
SBI, a financial conglomerate, is listing its financial unit by issuing Hong Kong depositary receipts. It would be only the second to go the HDR route after Brazil's Vale SA listed by introduction in Hong Kong last month. SBI plans to list sometime during the first quarter.
A spokeswoman at SBI declined to comment on its unit's listing plans, saying only that SBI Chief Executive Officer Yoshitaka Kitao said last year the company plans to raise capital in Hong Kong. SBI has four major business divisions—asset management, brokerage and investment banking, financial services, and real estate.
Also Wednesday, another person familiar with the matter said China Hongqiao Group, a Chinese aluminum-hydroxide producer, will begin investor presentations known as a roadshow on Monday for its US$1.5 billion offering.
Separately, Chinese iron-ore producer China Tian Yuan Mining Ltd., which had shelved its US$522 million IPO plan last year due to volatile markets, will relaunch the offering in the second quarter, another person familiar with the situation said Wednesday.
Hong Kong's IPO market performed strongly last year as Chinese companies tapped investor interest in China's heady growth. Mainland Chinese authorities restrict foreign investment in stock markets inside the country, but Hong Kong—a Chinese territory—operates under its own set of laws.
Non-Chinese companies have sought to follow the trend to take advantage of either higher valuations or to raise their profiles, banking on their ability to tap expanding Chinese demand for their products.
Last year, when Hong Kong topped IPO markets globally and was the most hectic market for IPOs, three non-Chinese companies were among the 10 biggest listings in the city. They were aluminum giant United Co. Rusal, whose US$2.2 billion January float was the first by a Russian company in the city; skin-care chain L'Occitane International SA, whose US$787 million IPO was the first by a French company in Hong Kong; and coking-coal producer Mongolian Mining /zigman2/quotes/208980443/delayed HK:975 +6.61% Corp., which raised US$749 million and became the first Mongolia-based company to list in Hong Kong.
By the end of 2010, and for the second year running, the Stock Exchange of Hong Kong topped the list of global venues for new share offerings by raising $57.16 billion, according to data provider Dealogic. Market turbulence and wariness among investors to commit capital as the year drew to an end, however, led to a few IPOs being pulled, among them the US$1.28 billion IPO of Huaneng Renewables Corp., the wind-power unit of China Huaneng Group.
CCB International (Holdings) Ltd. and Daiwa Securities Capital Markets Co. are handling the SBI unit's listing plan, the people said.
SBI is a joint-venture partner with Dow Jones & Co. in Wall Street Journal Japan KK, which publishes japan.WSJ.com, a Japanese-language website. News Corp /zigman2/quotes/201755982/composite NWSA +2.65% . owns Dow Jones, publisher of The Wall Street Journal.
Atsuko Fukase in Japan contributed to the article.
Write to Yvonne Lee at email@example.com