Mainland Chinese and Hong Kong firms have completed U.S. listings and raised funds at a record-high pace year-to-date, despite ongoing U.S.-China tensions.
Mainland and Hong Kong firms raised $6.6 billion in 2021, according to «Bloomberg» data, marking an eight-fold surge from the same period last year.
In total, Chinese firms raised nearly $15 billion from U.S. listings in 2020, the second-highest record after 2014 when e-commerce giant Alibaba raised $25 billion from its IPO.
Business as Usual
Despite ongoing political tensions and the Securities and Exchange Commission's decision to start implementing accounting rules that could results in delistings – a move introduced under the Trump administration aimed at China – mainland firms remain confident in fundraising from the U.S. market.
Still, Chinese firms going public are aware of the potential risks and have sought secondary listings in Hong Kong not only to expand their investor base but hedge against delisting risk.
Recently, Chinese authorities hinted at plans to sell global depository receipts in Switzerland, marking another potential fundraising channel in addition to the Shanghai-London stock link.
