HONG KONG (Reuters/IFR) - China Renaissance Group, an investment bank led by one of the country’s most famed rainmakers, aims to raise as much as $800 million in a Hong Kong IPO, people with direct knowledge of the matter told Reuters.
The bank is known for having advised both sides on some big Chinese tech deals including the 2015 merger of ride-hailing giant Didi Chuxing, with China Renaissance founder Bao Fan locking himself and the two CEOs in a hotel suite until they reached agreement.
Beijing-based China Renaissance plans to raise between $600 million and $800 million, the people said, declining to be identified as the details of the offering are not yet public.
It is targeting a valuation of between $4 billion and $5 billion, said one of the people, adding that its debut has been tentatively scheduled for October.
China Renaissance declined to comment on the planned IPO.
Bao, 47, who has previously worked at Morgan Stanley and Credit Suisse, has been described as one of the best-connected bankers in China. He plans to use part of the proceeds to develop the firm’s asset management business and to expand into markets such as United States and Southeast Asia, said the person.
The float will add to a growing list of Chinese tech-focused companies tapping Hong Kong for fundraising, with smartphone maker Xiaomi Corp [IPO-XMGP.HK] having launched an IPO worth up to $6.1 billion on Thursday.
Founded in 2005, China Renaissance started as a two-person team, seeking to match up capital-hungry startups with eager venture capitalist and private equity investors.
Since then, it has grown to become a 600-strong house that also provides underwriting, sales and trading services as well as research services.
The company filed for a Hong Kong IPO on Monday which confirmed that Goldman Sachs (GS.N) and ICBC International have been hired as joint sponsors. The prospectus, however, did not detail the amount of funds targeted or a time frame.
The prospectus showed that the company’s annual revenue rose about 4.5 percent in fiscal 2017 to $139.4 million. Annual profit attributable for the 2017 financial year, however, saw a nearly 100 percent fall to $32,000, hurt by rising expenses.
Leading Chinese investment banks have been hiring bankers in recent years seeking to entrench their domination of their home market and as they step up plans to expand abroad.
Last year, the firm said it expected its investment management arm’s assets to triple to $10 billion over three years as it looks to attract more foreign investors and launch diversified products including hedge funds.
Reporting by Susan Mathew in Bengaluru, Julie Zhu and Fiona Lau of IFR; Additional reporting by Sumeet Chatterjee and Kane Wu; Editing by Edwina Gibbs and David Evans