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SoftBank-backed OneConnect edges up after US$312m IPO

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China-based cloud fintech platform OneConnect Financial Technology rose in its trading debut after its US$312 million US initial public offering (IPO).

[SAN FRANCISCO] China-based cloud fintech platform OneConnect Financial Technology rose in its trading debut after its US$312 million US initial public offering (IPO).

OneConnect's American depositary shares rose as much as 7.1 per cent on Friday.

The company, one of several Ping An Insurance businesses backed by SoftBank Group Corp, sold 31.2 million shares Thursday at the top of a revised target range of US$9 to US$10. That followed a back-and-forth move by the company this week to first shrink its IPO goal to US$260 million from its earlier target of US$504 million, and then increase the size of the share sale.

OneConnect opted for a New York listing despite US-China tensions. The company earlier considered a Hong Kong listing with a target of raising about US$1 billion at a valuation of about US$8 billion, Bloomberg reported in February.

The IPO followed Thursday's signing by US president Donald Trump on a phase-one trade deal with China, averting a new wave of US tariffs that were set for Dec 15.

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OneConnect, backed by SoftBank's Vision Fund, provides technology solutions that help increase revenue and manage risks for small and midsize financial institutions in China.

SoftBank has placed bets on companies under the state-linked insurer Ping An, as part of its play in combining technology and insurance. Last year, Vision Fund invested in Ping An Good Doctor and Ping An Healthcare Technology.

OneConnect had a net loss of US$147 million on revenue of US$218 million during the nine months ended Sept 30, compared with an US$82 million net loss on revenue of US$128 million for the same period last year, its filings show. Since 2017, Ping An Group has extended to OneConnect more than US$1 billion in loans with interest rates ranging from 4.55 per cent to 7.3 per cent.

The offering was led by Morgan Stanley, Goldman Sachs Group, JPMorgan Chase & Co and Ping An Securities Group Holdings. OneConnect is trading on the New York Stock Exchange under the symbol OCFT.

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