Singapore sees more US-listed Chinese companies coming to its shores

Singapore Exchange (SGX) sees more listings in coming months by Chinese issuers that already trade American depository receipts, even as it grapples with delayed deals amid a global valuation slump.

Following Nio’s technical listing in May, investors can expect others will follow suit, chief executive officer Loh Boon Chye said in an interview. If market conditions are supportive for the rest of the exchange’s fiscal year through June, “there would be fundraising, but if they are not as conducive, it will be a technical secondary listing”, he added.

The bourse’s effort to woo Chinese firms comes as they face greater regulatory and delisting risks stateside, prompting a hunt for alternative venues including Switzerland. Listing plans globally this year have waned with investors deterred by high inflation and rising interest rates. Companies that have delayed offerings for units in the South-east Asian city-state include big-ticket names such as Thai Beverage and Olam Group.

The trading venue last month inked an accord with the New York Stock Exchange that allows for better collaboration on dual listings of companies, among other matters. “It allows companies that are already listed to think of another overseas exchange, if they do want to, and the MOU helps in terms of joint marketing,” Loh said.

There are at least 11 China-domiciled firms that have listings in both the US and Singapore, data compiled by Bloomberg shows. Singapore hasn’t had an IPO (initial public offering) in 3 months, with the haul of about US$385 million so far this year 59 per cent higher than during the same period in 2021, according to the data.

Pol de Win, SGX’s head of global sales and origination, previously said that the exchange was in talks with companies in China and South-east Asia operating in areas such as financial tech and consumer tech that it would like to attract.

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On potential homecoming listings by Grab and Sea, Loh said “there are other companies listed in the US that we want to talk to”.

Here are some other takeaways from the conversation with Loh:

• Potential special purpose acquisition companies are waiting to see mergers conducted by the first wave of blank-cheque companies in Singapore to see how the process unfolds, he said.

• The exchange is looking to invest, acquire or partner with firms that provide data, indices or technologies for asset classes such as currencies and commodities, and capital markets generally.

• Climate Impact X, a Singapore-based online carbon-credit trading market that’s backed by the exchange, aims to launch a spot market by 2023, Loh said. BLOOMBERG