A Hong Kong listing by Saudi Aramco would assist the oil giant in securing increased Chinese demand for its $100 bln share sale, according to the head of Hong Kong Exchanges & Clearing (HKEX), as stock exchanges around the world compete for the business. In October. Saudi Aramco said that exchanges in New York, London, Tokyo, and Hong Kong are being considered the partial listing of the state company’s shares.
“It’s going to provide compelling benefit because they are able to use the listing to anchor very massive Chinese demand at the IPO,” Charles Li said in an interview.
“It will become a great platform for the two major sovereigns to use as a potential platform for a broader level of financial or strategic investment decisions,” Li added, referring to China and Saudi Arabia. Li also said that he expects companies with dual class shares to be listed on Hong Kong’s main board.
“We should basically in a few weeks, hopefully be able to announce a structure where we will have a chapter inside the main board that allows companies to list in Hong Kong, with weighted voting rights structures.”
The Asian financial center’s exchange head is trying to attract new companies for the sake of keeping its title of a global listings powerhouse. In 2016, Hong Kong was the world’s largest initial public offering (IPO) exchange, but since has been having a hard time finding new companies.
In June, HKEX revealed a proposal for a new board allowing companies with share structures special voting rights, and those yet to make a profit, to list. Li said that HKEX will take in applications under the new voting structure most likely mid-year of 2018.
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“We are coming to a general agreement that this is the direction to go and we are ready to go,” he said.