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Nikkei Markets

Xiaomi IPO to secure $548 million from seven cornerstone investors, sources say

HONG KONG (Nikkei Markets) -- Chinese smartphone major Xiaomi's initial public offering in Hong Kong will secure $548 million from seven cornerstone investors including China Mobile and U.S.-based Qualcomm, according to sources.

CICFH Entertainment has agreed to invest about $192 million in the offering, while China Mobile and U.S.-listed technology major Qualcomm will each subscribe to $100 million of shares in the IPO, three sources familiar with the matter said. CDB Private Equity, Grantwell Fund, Celestial Ocean Investments and China Merchants Group are among the other cornerstone investors. The seven investors are subject to a six-month lockup period.

The Beijing-based company and selling shareholders will together offer about 2.18 billion shares in an indicative price range of HK$17 ($2.17) to HK$22 per share. At the top end of the indicative range, the company will raise nearly HK$48 billion in gross proceeds. At HK$22 per share, the company will have an implied market capitalization of $69.76 billion.

The IPO has a greenshoe or overallotment option of 15% of the shares being offered.

The IPO opens for subscriptions on Thursday. Trading in the shares is expected to begin on Hong Kong's main board on July 9.

Xiaomi, the world's fourth largest smartphone maker by sales volume, had last month filed a draft prospectus for a listing under a dual-class voting structure. The company, which had also made plans to list Chinese Depositary Receipts in the mainland, on Tuesday said it will postpone its CDR issue to focus on the Hong Kong offering first.

-- Amy Lam and Carrie Chen

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