(Bloomberg) -- Chinese appliance maker Midea Group Co.’s shares gained as much as 6% in gray-market trading ahead of their Tuesday debut in Hong Kong.
The shares traded as high as HK$58.10 each on an over-the-counter retail platform operated by Phillip Securities Group. They were priced at HK$54.80 apiece. Companies can sell shares in the gray market one day before officially listing them in the stock exchange.
Foshan, China-based Midea raised $4 billion in an enlarged deal that was priced at the top of the marketed range. The company’s Shenzhen-listed stock has climbed about 16% this year versus a decline of almost 8% in the CSI 300 Index — a benchmark of onshore Chinese equities.
A successful debut by Midea is seen having the potential to bolster investor confidence toward Hong Kong’s IPO market, where issuance has plunged in recent years amid China’s economic and regulatory struggles. At $4 billion, Midea’s listing will be the city’s biggest debut since Kuaishou Technology’s $6.2 billion listing in early 2021.
Founded in 1968, the company sells air conditioners, washing machines, elevators and other products. Its brands include Comfee, Eureka and Little Swan.
China’s largest appliance manufacturer plans to use some of the proceeds to expand its global distribution channels and sales network to boost overseas sales. That’s in line with the broader push by Chinese businesses to expand abroad as local competition intensifies and consumption wanes.
(Updates gray-market trading in first and second paragraphs.)
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