FWD drops planned US listing as Beijing tightens grip
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HONG KONG • FWD Group, the Hong Kong-based insurer backed by billionaire Richard Li, has withdrawn its United States initial public offering (IPO) as China tightens its grip on overseas listings.
The company said in a filing with the US Securities and Exchange Commission (SEC) on Monday that it is "considering other alternatives" and has decided not to proceed with its New York listing. FWD is considering an IPO in Hong Kong next year instead, Bloomberg News reported this month.
While FWD has no business operations in China, increased market volatility and some high-profile failures such as Didi Global have changed market sentiments on listings by companies based in China and Hong Kong. Didi is planning to delist from the US after losing over half of its market value since its June trading debut.
FWD raised US$1.4 billion (S$1.9 billion) this month in a private placement from investors including Apollo's Athene Holding, Canada Pension Plan Investment Board, Siam Commercial Bank and Swiss Re.
The financing valued FWD at about US$9 billion while the US listing would have given it a valuation of US$13 billion, Bloomberg News reported.
Other investors in the funding round include the Li family's Li Ka Shing Foundation, Metro Pacific Investments and Mr Richard Li's investment firm Pacific Century Group, according to a statement.
While FWD had secured approval from the SEC to begin marketing the IPO to investors, the company decided to switch its venue to Hong Kong, Bloomberg reported earlier.
The US listing could have raised as much as US$3 billion, Bloomberg News has reported.
The funds raised in the private placements will cut the group's debt, which had ballooned after years of acquisitions across South-east Asia, clearing the path for the Hong Kong listing to be mainly about funding growth.
The value of the insurer's new business climbed 45 per cent in the first half of 2021 from a year earlier. In the third quarter, the same figure - a key metric of profitability - grew year over year by more than 20 per cent, according to its SEC filings.
BLOOMBERG
