Hong Kong's first SPAC listing sees Aquila shares untraded (updated)
18/03/2022 05:01
(Add comment, listing details)
HONG KONG, March 18 (Reuters) - Shares in Aquila Acquisition
Corp 7836.HK on Friday made a muted debut in the first special
purpose acquisition company (SPAC) listing in Hong Kong as the
city's bourse talked up what it calls "a new route to market".
Hong Kong regulators gave the green light for such listings
in January and a further nine SPACs have since lodged filings to
follow Aquila's debut, in which it raised just under $130
million.
But amid restrictions on retail investors and what market
watchers called unfamiliarity with SPACs, Aquila shares remained
untraded as of 0437 GMT.
Market participants said Hong Kong hoped to attract
investors from mainland China to list SPACs, firms that raise
cash to buy private firms, taking them public without a
traditional initial public offering (IPO).
The deals come after Singapore became the first major market
in Asia to allow SPACs to trade in the wake of a surge in 'blank
cheque' firms listing in the United States. But a number of
those U.S. firms are now trading under water, tempering the
appetite of global investors for such deals.
Hong Kong Exchanges and Clearing Ltd (HKEX) 0388.HK
welcomed the SPAC listing on the exchange's main board.
"It adds a new route to market for issuers (and) further
diversifies our listing offering," HKEX Chief Executive Officer
Nicolas Aguzin said in a statement.
Aquila said in filings it raised HK$1 billion ($128 million)
by selling 100 million Class A shares at HK$10 each, in an
offering that also included 50.03 million warrants. It said it
intends to look for deals among companies in new economy sectors
such as green energy.
A total of 99 investors bought into the Aquila SPAC, the
filings show, with 40 of those considered professional
institutional investors.
"It is new in the market and is only a shell," said Steven
Leung, sales director at UOB Kay Hian, as the shares failed to
trade.
"It may take a while for investors to get used to it and
until sentiment for SPACs heat up again. And there are
restrictions for retail investors, they cannot simply jump into
it like other stocks."
Retail shareholders are restricted from buying the SPAC
stock until the company makes an acquisition, which reduces the
number of investors who can trade the shares.
Meanwhile Chinese investment banks regulated by the China
Securities and Regulatory Commission (CSRC) have been barred
from being SPAC promoters in Hong Kong, Reuters reported last
week. urn:newsml:reuters.com:*:nL3N2VC2R2
($1 = 7.8172 Hong Kong dollars)
(Reporting by Scott Murdoch and Donny Kwok; Editing by Kenneth
Maxwell)
((Scott.Murdoch@thomsonreuters.com;))