Weibo to guide Hong Kong offering price at HK$272.80 a share

[HONG KONG] Weibo Corp and its shareholder Sina Corp priced shares in the Twitter-like website's Hong Kong second listing at HK$272.80 (S$47.87) each, raising about HK$3 billion despite Beijing's latest market-dampening regulatory moves.

The price represents a discount of about 2.8 per cent to Wednesday's (Dec 1) US$36 close in New York. The Chinese social media company sold 5.5 million new shares in the Hong Kong offering, while Sina sold 5.5 million existing shares. The sellers set a maximum price of HK$388 for the portion of the deal being marketed to Hong Kong's retail investors.

Weibo's Hong Kong listing comes as Chinese regulators continue their relentless tightening of oversight on local firms traded overseas. China will issue new draft rules as soon as this month restricting the use of so-called variable interest entities (VIEs), Bloomberg News reported on Wednesday. The rules would ban VIEs' use in new listings aside from in Hong Kong, and would require more transparency from firms that already use the structure.

Weibo's American depositary receipts plunged 9.6 per cent during Wednesday trading in New York, their biggest fall since late August. They have lost more than 30 per cent of their market value since early July, when a cybersecurity probe of Didi Global kicked off a round of moves that wiped about a trillion dollars off Chinese companies globally.

Internet pioneer Sina launched Weibo in 2009, swiftly amassing millions of registered users posting messages of 140 characters or less, and was listed on the Nasdaq in a 2014 initial public offering. Whereas Twitter is blocked in China, Weibo and other social media in the country are subject to state censorship.

Weibo has been quick to close accounts of users posting content deemed controversial. In September, the company said it had shut down at least 52 accounts posting stock tips due to violations of new rules on economic and finance-related information.

Goldman Sachs Group, Credit Suisse Group Citic Securities and China International Capital Corp are joint sponsors of the offering, according to a prospectus.

BLOOMBERG