China Telecom Corp plans to sell $3.68 billion in stock as it presses ahead with an IPO in market conditions that have persuaded many other companies to postpone their offerings.
The offering is far bigger than expected as it had mooted raising between $2.5 billion and $3 billion as recently as August. But China Telecom is clearly gambling on the fact that an opportunity to invest in the incumbent of the world’s most populous nation will be too good to miss, even in a downturn.
It plans to sell 16.8 billion shares, or around 20% of total equity, at a price between HKD 1.48 and HKD 1.71 ($0.19 and $0.22). China Telecom has insisted that funding was not to finance any large scale projects at present but it would benefit from increased transparency and improvements in management as a public company.