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Yahoo
23-05-2025
- Business
- Yahoo
Jamie Dimon Says JPMorgan Was Right to Do CATL Deal Despite Opposition
(Bloomberg) -- JPMorgan Chase & Co. underwrote Contemporary Amperex Technology Co. Ltd.'s Hong Kong listing despite opposition from US lawmakers, given that Washington hasn't placed sanctions on the Chinese battery maker, Chief Executive Officer Jamie Dimon said. Can Frank Gehry's 'Grand LA' Make Downtown Feel Like a Neighborhood? Chicago's O'Hare Airport Seeks Up to $4.3 Billion of Muni Debt NJ Transit Makes Deal With Engineers, Ending Three-Day Strike 'If we thought it was wrong, we wouldn't do it,' Dimon said in an interview with Bloomberg Television on Thursday at JPMorgan's Global China Summit in Shanghai. CATL, as the electric-vehicle battery maker is known, debuted its Hong Kong shares this week in the world's biggest listing of the year, raising $5.2 billion. 'The government did not sanction CATL,' Dimon said. 'There are people who didn't want us to do it for a bunch of reasons, and they may have somewhat legitimate reasons. But I think the government should decide what to do.' The House Select Committee on the Chinese Communist Party had sent Dimon and Brian Moynihan, the CEO of fellow CATL underwriter Bank of America Corp., letters in April urging them to withdraw from the listing, citing the company's inclusion on a Pentagon blacklist alleging links to the Chinese military. CATL denies having military links. Just this week, founder and Chairman Robin Zeng told Bloomberg News that the 'accusation is completely groundless.' He also said Dimon wrote him several letters expressing his support for CATL. CATL's Hong Kong shares were down about 2% Thursday afternoon at around HK$330. That's significantly higher than the listing price of HK$263 following gains of more than 10% both Tuesday and Wednesday. The shares will be added to MSCI's standard and large cap gauges for China from June 2, the index provider said Wednesday. CATL also trades in Shenzhen, where it is up about 32% over the past 12 months. After CATL exercised the so-called greenshoe option, the overall proceeds of the Hong Kong listing rose from HK$35.7 billion ($4.6 billion) to HK$41 billion. That meant the maximum number of shares that could've been sold were sold. The Fujian-based battery maker has said the proceeds will help fund its expansion in Europe. 'We and other investment banks do a lot of due diligence around all the issues that people raise,' Dimon added. Why Apple Still Hasn't Cracked AI Inside the First Stargate AI Data Center Anthropic Is Trying to Win the AI Race Without Losing Its Soul Microsoft's CEO on How AI Will Remake Every Company, Including His Cartoon Network's Last Gasp ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Kuwait Times
21-05-2025
- Automotive
- Kuwait Times
Battery giant CATL ends up over 16% on Hong Kong debut
HONG KONG: Chinese battery giant CATL ended its first day on the Hong Kong Stock Exchange more than 16 percent higher Tuesday, having raised US$4.6 billion in the world's biggest initial public offering this year. A global leader in the sector, CATL produces more than a third of all electric vehicle (EV) batteries sold worldwide. The firm has been buoyed by a rapid growth in China's domestic electric vehicle sector and it now works with major brands including Tesla, Mercedes-Benz, BMW and Volkswagen. However, it has also found itself in the crossfire of a superpower clash between Washington and Beijing for tech dominance, with Washington putting it on a blacklist naming it as a military company. The firm is already traded in the southern Chinese city of Shenzhen, and its plan for a secondary listing in Hong Kong was announced in December. In morning trading its Hong Kong shares hit a high of HK$311.40 (US$39.92), up 18.4 percent from its listing price of HK$263.00. The stock closed at HK$306.20. 'This listing signifies our deeper integration into the global capital markets and marks a new milestone in our mission to drive the global zero-carbon economy,' CATL's founder and chairman Robin Zeng said at the firm's listing ceremony on Tuesday. The raised funds could be used to accelerate its overseas expansion, including building its second European factory in Hungary after launching its first in Germany in January 2023.—AFP The strong interest in the company's shares come even as it comes under the spotlight in the United States. In a list issued in January by the US Defense Department, CATL was designated as a 'Chinese military company'. The US House Select Committee on the Chinese Communist Party highlighted this inclusion in letters to two Wall Street banks in April, urging them to withdraw from the IPO deal over its alleged links to the military. But the banks—JPMorgan and Bank of America—remain onboard. Beijing has denounced the list as 'suppression', while CATL denied engaging 'in any military related activities'. CATL also said in May filings it was 'proactively engaging' with the Pentagon to 'address the false designation'. Founded in 2011 in the eastern Chinese city of Ningde, the company has been given strong financial support from Beijing, which has sought in recent years to shore up domestic strength in certain strategic high-tech sectors. It has also weathered a fierce price war in China's expansive EV sector that has put smaller firms under huge pressure to compete while remaining financially viable. Tuesday's blockbuster listing is also a boon for Hong Kong's stock exchange, which is eager for the return of big-name Chinese listings as it looks to regain its crown as the world's top venue for IPOs. The Chinese finance hub saw a steady decline in new offerings after Beijing's regulatory crackdown starting in 2020 led some mainland mega-companies to put their plans on hold, while a strict security law added to the uncertainty for companies looking to list. Data from the Hong Kong Stock Exchange shows it is processing dozens of applications from Chinese companies this year. Analysts said Tuesday's IPO showcases Hong Kong's role as a place for Chinese companies to raise capital. 'We are also seeing a rising demand on portfolio diversification away from US dollar-denominated assets, underscored by the recent strength in the Hong Kong dollar,' Jason Lui, head of APAC equity and derivative strategy at BNP Paribas, told AFP. – AFP
RTÉ News
20-05-2025
- Business
- RTÉ News
CATL's strong Hong Kong debut boosts outlook for Chinese companies' fundraising
Shares in CATL closed 16% higher on their Hong Kong debut today after the Chinese electric vehicle battery giant raised $4.6 billion in the world's largest listing this year, boosting prospects for equity sales by Chinese companies. CATL's strong debut came despite heightened market uncertainty, a Chinese economic slowdown, and the company being placed on a US Department of Defense list in January of companies accused of working with the Chinese military. With CATL saying in its prospectus that it was working with the US department to address the "false designation", global investors, including from the US, put in bids for multiple times the number of shares on offer. That augurs well for other Chinese companies looking to raise funds in Hong Kong, at a time when trade-related uncertainties, ballooning fiscal debt and weakened confidence about enduring US exceptionalism have weighed on US assets. The demand for CATL shares is also partly driven by an increasingly positive sentiment towards China among global investors that has emerged since the start of the year despite the Sino-US tariff war. CATL shares traded as high HK$311.40 each in Hong Kong after the firm sold shares at HK$263 each in the listing. The stock closed at HK$306.20, up 16.4% from the offer price and compared to a 1.5% surge in the main Hang Seng index. The company, which is also listed in Shenzhen, was the second most actively traded stock by turnover in Hong Kong, with 27.69 million shares worth HK$8.28 billion changing hands on its first day of trading. CATL had aimed to raise about $4 billion in the listing but increased the size following the strong demand from investors. A so-called "green shoe option" can still be exercised that would take the size of its fundraising to $5.3 billion. At that size, it would be the largest listing in Hong Kong since Kuaishou Technology raised $6.2 billion in 2021, according to LSEG data. The institutional tranche of the deal was oversubscribed 15.2 times, according to CATL's filings, while the retail portion was 151 times oversubscribed. "This listing means our wider integration into the global capital market and a new starting point for us to promote the global zero-carbon economy," CATL founder and Chairman Robin Zeng said at the listing ceremony. CATL has said that most of the funds raised would be used to build a factory in Hungary, part of its plan to make batteries in Europe for automakers such as BMW, Stellantis and Volkswagen. The deal means $7.73 billion has been raised in Hong Kong through initial public offerings and second listings so far in 2025, compared to $1.05 billion at the same time last year, according to LSEG data. Bonnie Chan, CEO of bourse operator Hong Kong Exchanges and Clearing, said more than 40 firms listed in mainland China, known as A-share companies, were exploring Hong Kong listings. "One major advantage for these companies to pursue a listing in Hong Kong is the fact that it would open up an offshore fundraising platform to support their offshore expansion plan," she said. Wang Shuguang, a member of China International Capital Corp's management committee who oversees investment banking, said CATL's listing could help revive Hong Kong's capital markets. CICC was a sponsor of the CATL listing alongside JPMorgan, Bank of America and China Securities International. The bookbuilding for CATL's share sale started on May 12, the day the US and China announced a truce in the trade war that had roiled global financial markets since early April. The 90-day truce created some extra momentum for CATL after the offering had already been covered with pre-commitment orders when the deal launched last Monday, according to two sources with direct knowledge of the process. The tariffs pause prompted some global long-only investors who had previously not bid for CATL stock to place orders, said the sources, declining to be named as they were not authorised to speak about the details. CATL did not respond to a request for comment. The company has been extending its lead in the EV battery market, with a 38% share globally in 2024, up from 36% a year earlier, according to data from SNE Research. The sources said CATL's decision to restrict US onshore investors from buying its shares in the Hong Kong offering did not dent demand. Some US investors with offshore accounts could still participate and some did so, shrugging off the Sino-US trade tensions and the US defense department's designation of the company.
Yahoo
20-05-2025
- Automotive
- Yahoo
China's EV battery leader surges in world's biggest listing this year
HONG KONG — In the latest sign of the growing edge China's clean energy companies have on their U.S. competitors, the country's leading electric vehicle battery maker raised $4.6 billion in its Hong Kong trading debut on Tuesday — the largest in the world this year. Shares of Contemporary Amperex Technology Co. Ltd., or CATL, the largest EV battery maker, traded as much as 18.4% above the listing price of 263 Hong Kong dollars ($33.61), raising at least $4.6 billion. At a ceremony at the stock exchange in central Hong Kong, CATL's billionaire founder Robin Zeng marked the start of trading by banging a bronze 'megagong' reserved for only the biggest listings. The company, which makes batteries for Tesla and other automakers and has a tech licensing agreement with Ford, controls more than a third of the global market for EV batteries. 'It's the 800-pound gorilla in the battery space,' said Lei Xing, an independent analyst of the Chinese auto industry based in Amherst, Mass. 'You could look at it as the Tesla of batteries.' International investors clamored for CATL stock despite U.S.-China tensions that have effectively kept it and other Chinese EV and battery makers — and their world-leading technology — out of the U.S., the second-largest passenger vehicle market in the world after China. U.S. investors were restricted from buying stock unless they had offshore accounts. Zeng was joined by officials representing the coastal city of Ningde in China's Fujian province, where CATL is based. 'The Hong Kong listing means that we are more deeply integrated into the global capital market, and it marks a new starting point in promoting the global zero-carbon economy,' he said. The listing is also a boost for the Chinese territory of Hong Kong, an international financial hub where the market has been sluggish in recent years. One reason Chinese companies are choosing to list in Hong Kong is to mitigate geopolitical risk, Xing said, as it's 'closer to home, safer.' In the U.S., CATL is among dozens of companies the Pentagon blacklisted in the final days of the Biden administration over alleged ties to the Chinese military, which CATL denies. The House select committee on the Chinese Communist Party cited that blacklisting last month in letters to Bank of America and JPMorgan Chase urging them to withdraw from the deal — both banks remained involved. Ford has faced questions from lawmakers over an agreement to license technology from CATL to produce battery cells at a $3.5 billion battery plant in Michigan. Chinese EV and battery makers also face a 100% U.S. tariff on EVs and a 25% tariff on lithium-ion EV batteries introduced by the Biden administration, as well as the steep tariffs on all Chinese imports imposed by President Donald Trump, with both presidents citing unfair trade practices by Beijing. CATL says the impact of tariffs is minimal given its limited business in the U.S. Experts say the trade barriers could slow the development of American EVs, whose high prices have discouraged consumers from buying. It would take 'at least a decade' for the U.S. to develop its own version of CATL, Xing said. The company, which was founded in 2011 and is already listed in the mainland Chinese city of Shenzhen, made $50 billion in revenue last year, about 70% of it in China. It faces intense competition, however, from Chinese rivals such as BYD — reporting an almost 10% decrease in revenue last year, the first such drop since CATL began releasing operating figures in 2015. CATL says it will use almost all of the funds raised in Hong Kong to build a a $7.3 billion factory in Hungary, allowing it to make batteries in Europe for automakers such as BMW, Stellantis and Volkswagen. 'They know that in order to continue to grow the way they want to, they really need to establish a presence outside of China,' said Tu Le, the Detroit-based founder and managing director of Sino Auto Insights. 'And the four-and-a-half-billion-dollar IPO is effectively building a war chest for them to do that.' The 'irony,' Le said, is that 'it could be the CATLs and the BYDs that provide the jobs for Americans moving forward, because they're really leading the way.' CATL said last month that its new battery cell could give a car more than 300 miles of driving range with just five minutes of charging. 'At the end of the day, the only way to make more affordable electric vehicles is to lower the battery pack price,' Le said. 'And the only game in town currently able to do that are Chinese players.' This article was originally published on
Yahoo
20-05-2025
- Automotive
- Yahoo
Wall Street Loves China's Battery Beast--Even the Pentagon Can't Stop It
Contemporary Amperex Technology Co. Ltd (CATL) just pulled off the biggest listing of the yearand did it with style. The Chinese battery leader's shares jumped 16% in their Hong Kong debut after raising $4.6 billion, a number that could climb to $5.3 billion with full allotment. The offering attracted massive interest from both institutional and retail investors, despite CATL being blacklisted by the Pentagon earlier this yeara move the company continues to deny relevance to. The stock opened at HK$263 and closed well above that, even trading higher than its Shenzhen counterparta rare feat for dual-listed Chinese names. CATL, the dominant force behind 38% of the global EV battery market, supplies Tesla (NASDAQ:TSLA), Volkswagen, Ford, and others. It's also stepping on the gas with new tech: batteries that can deliver over 500km of range in just five minutes of charging and up to 1,500km fully charged. That kind of leap, combined with a forward earnings multiple around 17x, has some analysts seeing upside potential of up to 50%. Jefferies' Johnson Wan noted the setup was a no-brainer buy, citing solid fundamentals, global tailwinds, and a fresh $7.6 billion earmarked for overseas expansionespecially into Europe, where margins are wider and demand is climbing. Options trading volume on day one topped 34,000 contracts, the highest in a decade for Hong Kong IPOs with listed options, and sentiment leaned heavily bullish. Backed by big names like Qatar Investment Authority and Hillhouse, CATL's listing could help revive Hong Kong's IPO scene, lifting total issuance above $22 billion for the year. JPMorgan and Bank of America, despite political pushback from a U.S. congressional committee, stayed on the dealsignaling confidence in CATL's growth story. Chairman Robin Zeng called the listing a milestone in its push for a zero-carbon future, while the broader market seems to agree: investors want in, and they're willing to look past the noise to bet on the next leg of the global EV race. This article first appeared on GuruFocus. Sign in to access your portfolio
