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Consumer lender Home Credit appoints banks for over US$1b HK IPO

Hong Kong

GLOBAL consumer lender Home Credit Group has appointed Citigroup, HSBC Holdings and Morgan Stanley to lead its upcoming Hong Kong initial public offering (IPO) of at least US$1 billion, three people with direct knowledge of the matter said.

The Prague-based lender plans to go public after the summer, the people said, speaking on condition of anonymity.

One person said Home Credit plans to file with the Hong Kong stock exchange as early as next month and list in September or October.

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It is looking to raise at least US$1 billion, the people said, cautioning that the final figure could change depending on the valuation.

Home Credit, Citi, HSBC and Morgan Stanley declined to comment.

Founded in 1997 in the Czech Republic, Home Credit operates in 10 countries including the United States, Russia and India, and has assets amounting to over 23.6 billion euros (S$36.3 billion) worldwide. It has also grown into one of the biggest non-bank consumer lenders in China.

In May, Czech investment group PPF increased its holding in Home Credit after buying a 2.5 per cent stake from co-shareholder Emma Capital in a deal valuing the company at 8.5 billion euros.

PPF, owned by the Czech Republic's richest businessman, Petr Kellner, raised its stake to 91.1 per cent, with fellow Czech investment group Emma Capital holding the remaining 8.9 per cent.

Home Credit granted loans of 15.12 billion euros and had 28.9 million active customers in the first nine months of 2018, its website showed. It made a net profit attributable to shareholders of the parent of 229 million euros for the same period.

China is its largest country of operation, contributing 88 million euros to its net income for the first nine months of last year, according to its quarterly results.

Home Credit joins a number of other non-Asian companies looking to go public in Hong Kong with large IPOs, such as a spin-off from the world's largest brewer, Anheuser-Busch InBev as well as British data centre operator Global Switch.

The two are hoping to raise at least US$5 billion and up to US$1 billion, respectively.

Having topped the global charts for funds raised in IPOs in 2018, Hong Kong is currently lagging behind both the New York Stock Exchange and Nasdaq with US$4.5 billion raised as at mid-May, Refinitiv data showed. That compares with US$15.2 billion on the NYSE and US$10.1 billion on Nasdaq.

The biggest listing in Hong Kong so far has been that of Chinese securities firm Shenwan Hongyuan which raised US$1.2 billion. REUTERS