Chinese Battery Giant CATL Seeks Over $4 Billion In Hong Kong Listing
3 minute readPublished: Monday, May 12, 2025 at 5:51 am
**CATL, the World's Largest EV Battery Maker, Eyes $4 Billion Hong Kong Listing**
Contemporary Amperex Technology (CATL), the world's leading electric vehicle (EV) battery manufacturer, is making a significant move. The Chinese giant, led by billionaire Robin Zeng, is seeking to raise over $4 billion through a secondary listing in Hong Kong. The company began taking investor orders on Monday, with plans to sell 117.9 million shares at a maximum price of HK$263 each. This could potentially reach over $5 billion if underwriters exercise an option for additional shares. Public trading is slated to begin on May 20th.
The funds raised will primarily finance the construction of a new factory in Hungary, a project estimated to cost €7.6 billion ($8.5 billion) and create nearly 10,000 jobs. CATL, already listed in Shenzhen with a market capitalization of $150.6 billion, has attracted significant interest from cornerstone investors, including Sinopec Group and the Kuwait Investment Authority, who have committed to purchasing over $2.6 billion worth of shares.
However, the listing isn't without its hurdles. Some investors may be concerned about the pricing, as CATL's Hong Kong shares are only offered at a 1.4% discount compared to its Shenzhen closing price. Furthermore, U.S. onshore funds are unable to participate due to CATL's use of Regulation S, which exempts shares sold outside the U.S. from certain registration requirements. This move may be a strategic decision to mitigate risks amid rising geopolitical tensions between China and the U.S.
Adding to the complexity, CATL faces scrutiny from the U.S. government, which named the company a Chinese Military Company in January. This has led to calls for investment banks involved in the underwriting to withdraw, citing regulatory and reputational risks. The company also acknowledges tariff-related risks, particularly those imposed by the U.S. on Chinese imports. While CATL's direct revenue from products exported to the U.S. is limited, the company recognizes the evolving nature of global trade policies.
Despite these challenges, CATL's financial performance remains strong. While total sales decreased slightly last year, profits increased, with 70% of sales originating from mainland China and the remainder from other regions, including Europe and the U.S.
BNN's Perspective:
This listing highlights the continued global expansion of Chinese EV battery manufacturers. While the geopolitical climate presents challenges, CATL's strong financial performance and strategic investments in Europe suggest a long-term commitment to the global EV market. The success of this listing will be a key indicator of investor confidence in the sector and the company's ability to navigate international trade and regulatory hurdles.
Keywords:
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