China Mobile eyes $10.4b Shanghai debut post-Trump ban

Workers placing a China Mobile 5G sign on equipment at a 5G base station in Fenggang, Guizhou province. PHOTO: REUTERS

BEIJING (BLOOMBERG) China Mobile, the country's largest wireless carrier by revenue, is aiming to raise 48.7 billion yuan (S$10.4 billion) from its Shanghai listing in what would rank among the largest share offers for the nation's domestic stock market in a decade.

The state-run company, which was removed from the New York Stock Exchange (NYSE) earlier this year due to an investment ban ordered by former United States president Donald Trump, said it will issue 845.7 million shares at 57.58 yuan apiece on Wednesday (Dec 22), according to the company's prospectus filed with the Shanghai bourse late Monday.

The proceeds that China Mobile is seeking to raise would rival that of Semiconductor Manufacturing International's offer in Shanghai last year, making it among the top 10 listings on record in China, according to data compiled by Bloomberg.

Assuming its over-allotment option is exercised in full, China Mobile would raise 56 billion yuan from the listing, according to the prospectus. The NYSE suspended trading in China Mobile in January, along with the Asian nation's other major state-owned operators, China Telecom and China Unicom Hong Kong.

That development followed an order barring US investments in Chinese companies that the Trump administration deemed a threat to national security. China Telecom listed in Shanghai in August after raising more than US$7 billion (S$9.6 billion).

China United Network Communications was already trading on the exchange. China Mobile's A-share offer will carry a price to earnings ratio of 12.02 times, based on its 2020 net income of 4.79 yuan per share calculated according to its total share capital enlarged by the offer, the prospectus shows.

The company's Hong Kong-listed shares were little changed in trading on early Tuesday morning. Proceeds from the listing in the Chinese financial hub will be used to fund 5G network expansion, cloud infrastructure, smart-living projects and technology development that will cost the company 157 billion yuan in total, China Mobile has said.

China International Capital and Citic Securities are sponsors of China Mobile's A-share offer. The main underwriters include Huatai United Securities, BOC International (China) and China Merchants Securities.

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