Chinese Tianqi Lithium, manufacturer of lithium batteries, announced yesterday that it will open at the Hong Kong stock exchange with what it intends to raise part of the US $ 4,066 million, with which agreement was reached – until mid-May – to buy Nutrien 24%. that he owns SQM.
With this, the company wants to raise more than US $ 2,000 million, of which a fraction is allocated to refinance liabilities and at its own moment part of the costs of the 24% acquisition of SQM, which is expected to be realized in the last quarter of the year. While it is joining the Hong Kong Stock Exchange, it can be closed after the purchase is effective at the end of the year.
One of the objectives it will pursue with the opening in Hong Kong is to jump over the fences it will find on a square like Shenzhen, where there are bigger barriers to the entry of foreign investors. In fact, this is the path taken by those Beijing companies that want to internationalize and attract a larger share of foreign investors and funds.
The Hong Kong Stock Exchange is a more refined market that ensures compliance with better corporate governance standards, as well as information for the securities market required in that economy. This gives a larger value to the shares, because this financial market is more liquid and deep.
Ren Lefort, analyst at MBI, is optimistic about the opening of the Chinese company and notes that "with the doubts that have arisen as to whether or not materialized, this opening should tend to be positive because a large percentage of the collected amount to that acquisition (purchase of SQM) ".
For the purchase of SQM, Tianqi still requires regulatory approval. The company in Beijing said in a statement that "as a result (from the opening) the SQM transaction can be postponed, modified or completely blocked if the FNE determines that this risks competition for the competition and refers to the transaction of SQM to the Tribunal of Defense of free competition ".
Since the purchase agreement was announced on May 17, the shares of SQM in series A and B have decreased 15.89% and 14.37% respectively. The series B titles were the most traded on the stock market yesterday and fell by 0.42% to $ 29.75 per paper. Francisco Soto, share manager of Tanner Investments, said that "the action will have a recovery once the Tianqi acquisition is officially completed." One of the many reasons why the acquisition was put under pressure is the uncertainty with regard to whether the regulators will ultimately approve the transaction. "