By Prudence Ho And Rick Carew
HONG KONG--Guolian Securities Co., the joint venture partner of
Royal Bank of Scotland Group PLC in China, is planning an initial
public offering in Hong Kong this year, people familiar with the
situation said Thursday.
The Chinese brokerage is looking to raise around US$200 million
and is working with Bocom International Holdings Co., the
investment banking arm of Bank of Communications Co., and ABC
International Holdings Ltd., the investment banking arm of
Agricultural Bank of China Ltd., for the offering, one of the
people said.
Guolian will join other two Chinese brokerages--the
Shenzhen-listed GF Securities Co. and Huatai Securities--that are
looking to raise capital in Hong Kong this year. GF Securities
plans to raise US$1 billion in the first quarter this year, while
Huatai Securities aims to raise US$1 billion in the second
half.
Chinese brokerages have been raising capital to expand business
amid China's Shanghai Composite Index rising 37% in the fourth
quarter last year.
Guolian, which was founded in 1992, has more than 50 branches in
major Chinese cities such as Shanghai, Beijing and Guangdong,
according to its website. It posted a revenue of 1.02 billion yuan
(US$164 million) in 2013, up 24% from a year ago, while its net
profit surged 181% to 264 million yuan.
In 2010, it signed an agreement with RBS to set up a joint
venture which would underwrite stock and bond issuance in China.
Huaying Securities Co, the joint venture, started operation a year
after, in 2011.
RBS holds one-third of the Huaying joint venture, while Guolian
owns the rest. Foreign firms can take part in Chinese securities
transactions only through joint ventures with domestic firms.
Guolian and RBS couldn't immediately be reached for comment.
Write to Prudence Ho at prudence.ho@wsj.com and Rick Carew at
rick.carew@wsj.com
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