Just hours before it would have been obliged to issue a new prospectus for its IPO, China Telecom has relaunched the offer, cutting it down by 55% but leaving the terms of the offer unchanged.
China Telecom will now issue 7.55 billion H shares, 5% to retail Hong Kong investors, and the rest internationally, instead of the original 16.8 billion shares. However the offer price is unchanged at HK$1.47 to HK$1.69 with a promised dividend of 6.5 HK cents.
China Telecom pulled its US$3.6bn offering last week after the international segment was undersubscribed by 30%, with the Hong Kong retail segment just scraping through at 1.05 times over-subscribed - a sad contrast to the recent successful Bank of China (Honk Kong) offering.
Marketing of the international tranche opened yesterday and book building is expected to close by 5pm, New York time, today. The Hong Kong offering starts today and will close at noon next Monday. Market reactions in Hong Kong were mixed, but most commentators though the issue stood a reasonable chance of success in this new form.
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