China Life Insurance Group, the parent company of China Life Insurance (2628), is planning a backdoor listing of its key businesses in Hong Kong as early as this year.
The Beijing-based conglomerate plans to inject its main assets into the listed company, which will in turn issue new shares to the parent, sources said.
Listing the group would be a key step in Chairman Wang Bin's bid to revitalize the firm, a drive unveiled last year to speed up market-oriented reforms at the 4.5 trillion yuan ($642 billion) state-owned giant and focus on business value rather than size.
The move would also enable China Life Group to widen its access to capital markets without going through the more complicated and lengthy process of a separate initial public offering.
China International Capital Corp is advising on the deal.
Still, deliberations are at an early stage and China Life hasn't made a final decision on the plan, they said.
Meanwhile, Japanese cuisine restaurant operator Daikiya dropped plans for a Hong Kong listing that could raise up to HK$200 million due to worsening market conditions.
Daikiya was expected to debut tomorrow, with plans to offer 100 million shares at HK$1.6 to HK$2 apiece.
Retail investors were not positive about Daikiya's income growth, as the local retail sector struggles with store closures and customer declines amid social unrest and the Covid-19 epidemic.
Eight local brokers had lent only about HK$15.93 million through margin financing for Daikiya's IPO, representing less than 80 percent subscriptions of its retail portion. Some retail investors even canceled their orders before the IPO closed last week.
Daikiya, which operated 15 restaurants in Hong Kong, has warned that its net profit for the year ending March 31 is expected to fall.
Its adjusted net profit fell 52.11 percent year-on-year to HK$18.2 million for the four months ended July 31, 2019, affected by a drop in customer numbers.