Yet, as Washington denies Chinese companies access to US capital, a boom in the secondary listing of US-listed Chinese firms is underway in Hong Kong. On June 11, Nasdaq-listed Chinese mobile and PC gaming firm NetEase followed in Alibaba Group Holding’s footsteps with its own secondary listing in Hong Kong raising US$2.7 billion ($3.77 billion). The listing, which was 360 times oversubscribed, was one of the most successful IPOs in the former British colony’s history. Like Alibaba’s, Net-Ease’s US and Hong Kong shares are both fungible, meaning the US scrips can be traded in Hong Kong and the other way around.
(June 19): The simmering Cold War between the US and China last month finally spilled beyond trade, national security and the blame game over the coronavirus pandemic into global capital markets. At stake is the access to the world’s deepest pool of capital; large, liquid market; as well as accompanying reputational benefits.
In mid-May, the tech-heavy Nasdaq bourse and the US Congress made it harder for Chinese firms to list in America, over the growing concerns about accounting practices and shareholder rights. Investors around the world will likely be the losers as Chinese firms are forced to delist from the New York Stock Exchange (NYSE) and Nasdaq.
