HONG KONG (July 18): China Tower, the world's biggest operator of mobile phone network masts, plans to raise up to US$8.8 billion from a Hong Kong listing at a valuation of up to US$35 billion, Thomson Reuters publication IFR reported, citing people close to the deal.
The company plans to sell about 25% of its enlarged share capital and is in talks with potential cornerstone investors for what would be the world's largest initial public offering (IPO) in four years, IFR reported.
The US$35 billion valuation would be the top end of an indicative price range. China Tower is set to open books on July 23 and price the deal on Aug 1, according to IFR, adding that the terms and timing of the deal could still change before books open on Monday. It did not disclose the IPO price range.
At US$8.8 billion, China Tower's IPO will surpass the US$5.4 billion float of Chinese smartphone maker Xiaomi Corp in Hong Kong earlier this month, becoming the world's largest IPO since Chinese e-commerce firm Alibaba Group Holding Ltd's US$25 billion New York listing in 2014.
If a standard 15% "greenshoe" or over-allotment option of the base offering is exercised, that would bring the deal size to about US$10 billion.
The company was formed in 2014 from the tower operations of China's three state-backed telecoms providers — China Mobile Ltd, China Telecom Corp Ltd and China Unicom Hong Kong Ltd.
The three combined their towers to streamline operations and reduce duplication. At the time, China Mobile held 38% of the company, China Unicom 28.1% and China Telecom 27.9%. China Reform Holdings Corp Ltd, a state-owned asset manager, took the remaining 6%.
China International Capital Corp (CICC) and Goldman Sachs Group Inc are joint sponsors for the China Tower float.
China Tower, CICC and Goldman did not immediately respond to a Reuters request for comment.