BYD share sale to generate US$219m
Source: Bloomberg News |
June 21, 2011, Tuesday
|
Print Edition
Print Edition
BYD Co, the Chinese car maker backed by Warren Buffett, will raise 1.42 billion yuan (US$219 million) in its Shenzhen share sale, less than the company originally sought.
BYD will sell 79 million shares at 18 yuan apiece, the company said in a statement to the Shenzhen exchange on Sunday. The auto maker had planned to raise as much as 2.19 billion yuan, according to the company's statement.
Shenzhen-based BYD is tapping the mainland stock market to raise funds for expansion even as the CSI 300 Index, tracking stocks on the Shanghai and Shenzhen exchanges, has tumbled about 15 percent from its April high on concern economic growth is slowing. The timing of the share sale wasn't "good," Stella Li, senior vice president, said before the announcement.
"After the authorities approved our share sale, we had to go public within two months," Li said n June 17. "We'd rather list our shares next year, but it's out of our control."
The Hong Kong shares of the company have slumped 47 percent this year, compared with a 5.4 percent decline in the benchmark Hang Seng Index.
BYD's share-sale experience isn't unique. Prada SpA, the Milan-based luxury company, raised US$2.14 billion by selling shares near the low end of its target in this year's biggest Hong Kong initial public offering, according to people familiar with the matter. Samsonite International SA, the luggage maker, fell 7.7 percent last Thursday in its Hong Kong debut amid a global stock market slump and concern China's economy may cool.
BYD's sales fell for 10 straight months through May amid slowing vehicle demand growth and rising competition.
BYD will sell 79 million shares at 18 yuan apiece, the company said in a statement to the Shenzhen exchange on Sunday. The auto maker had planned to raise as much as 2.19 billion yuan, according to the company's statement.
Shenzhen-based BYD is tapping the mainland stock market to raise funds for expansion even as the CSI 300 Index, tracking stocks on the Shanghai and Shenzhen exchanges, has tumbled about 15 percent from its April high on concern economic growth is slowing. The timing of the share sale wasn't "good," Stella Li, senior vice president, said before the announcement.
"After the authorities approved our share sale, we had to go public within two months," Li said n June 17. "We'd rather list our shares next year, but it's out of our control."
The Hong Kong shares of the company have slumped 47 percent this year, compared with a 5.4 percent decline in the benchmark Hang Seng Index.
BYD's share-sale experience isn't unique. Prada SpA, the Milan-based luxury company, raised US$2.14 billion by selling shares near the low end of its target in this year's biggest Hong Kong initial public offering, according to people familiar with the matter. Samsonite International SA, the luggage maker, fell 7.7 percent last Thursday in its Hong Kong debut amid a global stock market slump and concern China's economy may cool.
BYD's sales fell for 10 straight months through May amid slowing vehicle demand growth and rising competition.
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