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 The rural lender, the last of China's big four state-owned banks to list, is preparing a dual initial public offering in Shanghai and Hong Kong next month that could exceed the record $21.9 billion IPO by Industrial and Commercial Bank of China in October 2006.
Original forecasts put the possible proceeds for the IPO at a whopping $30 billion. But investors appear unprepared to pay that much for shares in a bank whose profitability is viewed as weaker than its urban-focused competitors.
Beijing-based Agricultural Bank, also known as ABC, set the price range for its Shanghai shares at 2.52 yuan-2.68 yuan ($0.37-$0.39). The bank's Hong Kong IPO price range is 2.88 Hong Kong dollars to HK$3.48 ($0.37-$0.45).
The bank is offering 22.23 billion shares in Shanghai and 25.41 billion shares in Hong Kong, excluding an over-allotment option.
But analysts warn that investors may not be willing to bid at the top of the price range: mainland Chinese shares have slumped in recent weeks on worries that the huge IPO may overwhelm demand, pulling prices lower.
ABC will announce the final IPO price by July 7 and its shares begin trading in Shanghai on July 15 and a day later in Hong Kong.
[Associated
Press]
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