ICBC flotation: Fortune smiles

Author: | Published: 1 Dec 2006

Industrial and Commercial Bank of China's (ICBC's) recent IPO was not only the largest in China, raising over $21 billion, but it was also the first simultaneous offering of H-shares, listed on the Hong Kong stock exchange (HKSE), and A-shares, listed on a PRC domestic exchange (Shanghai, the SSE).

Previous proposed simultaneous offerings had either dropped the A-share offering at a late stage or proceeded with a staggered offering.

PRC regulatory restrictions on who can purchase H-shares (non-PRC nationals) and A-shares (PRC nationals, foreign strategic investors and qualified foreign institutional investors) mean that A- and H-shares are not fungible. Although both are ordinary shares of the same par value in the same issuer, they are marketed to separate markets. This distinguishes the A+H model from other dual listings (for example in Hong Kong and New York) where, even if the second listing is of depository shares, the underlying security is...