Hong Kong's FWD said to near filing for US$1b IPO

[HONG KONG] FWD Group Holdings, the Asian insurer backed by Hong Kong billionaire Richard Li, is close to filing an application for an initial public offering (IPO) in the city this year, according to people familiar with the matter, after US-China tensions scuppered more ambitious plans for an overseas debut.

The IPO filing is set to be lodged with the Hong Kong stock exchange as early as Monday, the sources said, asking not to be identified because the matter is private. The company could seek to raise about US$1 billion in a share sale, the sources said.

A listing may take place within the first half of the year, depending on market volatility and investor demand, the sources said. Considerations are ongoing and the deal could still face delays. The company is likely to announce full-year earnings also on Monday.

A representative for FWD declined to comment.

In December, FWD switched its listing venue to Hong Kong from the US, where it had filed for an IPO that could have raised as much as US$3 billion. The plan hit a snag amid US regulators' increasing unease over the long arm of the Chinese government, after a post-IPO probe of Didi Global kicked off a wide-ranging crackdown on firms listing overseas.

Although FWD has no business in China, the US market remains broadly closed to larger companies based in China and Hong Kong.

Late last year, FWD raised more than US$1.4 billion in private placements with investors including an insurer backed by Apollo Global Management. The placements were set to value the company at about US$9 billion, which would imply about 1.2 to 1.3 times its embedded value, people familiar with the matter said at the time. The company raised an additional US$200 million a month later as part of the same funding round, they said.

The funds raised in the private placements were earmarked to help the company cut debt, which had ballooned after years of acquisitions across South-east Asia, clearing the path for the Hong Kong IPO to be mainly about funding growth, the sources said. BLOOMBERG