China’s largest telecom carrier, China Mobile, has received the green light to launch an initial public offering (IPO) via the Shanghai Stock Exchange, after the company was removed from the New York Stock Exchange earlier this year due to a ban ordered by former President Donald Trump.
China Mobile said in a filing with the Hong Kong Stock Exchange, where it also trades, that it had received approval from the China Securities Regulatory Commission to move ahead with the share sale.
The carrier also said it plans to issue 845.7 million shares. Based on the closing price of its Hong Kong-listed stock Monday, the offer would raise the equivalent of around CNY39.16 billion ($5 billion). The telco also said that a price will be set following a roadshow with investors.
China International Capital Corp. and Citic Securities Co. are sponsors of China Mobile’s A-share IPO. The main underwriters include Huatai United Securities Co., BOC International (China) Co. and China Merchants Securities Co.
In August, China Mobile had filed a preliminary prospectus outlining an intent to raise CNY560 billion for the expansion of its 5G, cloud infrastructure and smart home projects.
China Telecom, the country’s second largest telecom firm, also trades in Hong Kong and had launched an IPO in Shanghai in August. Its $7.3 billion raise was one of the world’s largest this year. Rival China Unicom already trades in Shanghai and Hong Kong.
In May, the New York Stock Exchange (NYSE) rejected appeals by the three main Chinese mobile carriers to a delisting related to a presidential order blocking U.S. investment in companies considered a national security threat.
In January, China Mobile, China Telecom and China Unicom had called for the exchange to reverse the delistings and delay a suspension in trading of the shares while a review is conducted.
The NYSE announced just before the end of 2020 that it had begun proceedings to delist China Telecom, China Mobile and China Unicom’s shares from the stock market.
The move followed an executive order signed by former President Donald Trump on November 12, 2020, prohibiting any U.S. companies or people from investing in companies with ties to the Chinese military.
The NYSE had halted trading for these securities on January 11, 2021. The U.S. Department of Defense had previously stated that the three Chinese operators had significant connections to Chinese military and security forces.
In January, the China Securities Regulatory Commission (CSRC) had said that the decision by the NYSE will not have an impact in these three companies’ businesses, as the size of companies’ American Deposit Receipt (ADR) listings were less than 2.2% of their total equity, with a market capitalization of less than CNY20 billion.
