HONG KONG: SEHK Implements IPO Double Dipping Reforms

Wednesday November 22 2023

On 21^st November 2023, the Stock Exchange of Hong Kong Limited (SEHK)  published a revised Guidance Letter HKEX-GL85-16 (Guidance) allowing the existing shareholders (including pre-IPO investors) and cornerstone investors of a new applicant to subscribe for or purchase further securities in an IPO under certain specified conditions.

With immediate effect, “double dipping” will be permitted if it can be demonstrated that an IPO meets the new Size Exemption Conditions, namely that:

• the offer has a total value of at least $1 billion;
• the allocation to all existing shareholders and their close associates (whether as cornerstone investors and/or as placees) as permitted under the exemption does not exceed 30 per cent of the total number of securities offered; and
• each director, chief executive, controlling shareholder and PRC issuers, supervisor, of the listing applicant have confirmed that the listing applicant’s offer securities are not allocated to them or their close associates under the exemption.

Click on the above link for further information