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Jack Ma's Ant Group aims to raise $34.5 billion in largest IPO of all time | Markets – Business Insider

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Ant Group
Ant Group logo is pictured at the Shanghai office of Alipay, owned by Ant Group which is an affiliate of Chinese e-commerce giant Alibaba, following the coronavirus disease (COVID-19) outbreak, in Shanghai, China September 14, 2020.

  • Ant Group will raise $34.5 billion through a dual initial public offering in November, making it the biggest-ever IPO.
  • The financial services giant aims to evenly split its 1.67 billion-share debut across the Hong Kong and Shanghai exchanges.
  • Shares will be priced at 68.8 yuan ($10.27) each in Shanghai and at 80 Hong Kong dollars ($10.32) in Hong Kong. The collective sum trounces the previous $29 billion record set by Saudi Aramco’s IPO last year.
  • Ant is set to begin trading in Hong Kong on November 5, according to regulatory filings.
  • Visit the Business Insider homepage for more stories.

Ant Group plans to raise $34.5 billion in a dual initial public offering next month, edging out Saudi Aramco’s debut to become the largest listing of all time. 

The financial services company – an arm of billionaire Jack Ma’s Alibaba empire – will evenly split its offering, selling 1.67 billion shares each in debuts in Shanghai and Hong Kong. Shares listed on the Shanghai exchange will be priced at 68.8 yuan ($10.27) each, according to regulatory filings published Monday. The pricing implies a 114.9 billion yuan ($17.2 billion) windfall from the listing.

Shares set to trade on the Hong Kong exchange are priced at 80 Hong Kong dollars (10.32) each, setting up the other half of the listing to bring in 133.7 billion Hong Kong dollars ($17.2 billion). In total, the dual listing can value Ant at $313.4 billion should its market debut enjoy strong investor demand.

Read more: BANK OF AMERICA: Buy these 11 under-owned stocks ahead of their earnings reports because they’re the most likely candidates to beat expectations in the weeks ahead

Such an IPO would also trounce the record set by Saudi Aramco in 2019. The oil titan raised $29 billion in a share sale that temporarily established it as the world’s highest-valued company. 

Ant could even push its fundraising total just below $40 billion if it sells shares through so-called greenshoe options. The agreements allow the company’s underwriters to sell additional shares than initially planned. If investor demand permits, Ant can raise another $5.2 billion across both exchanges through the over-allotment options.

The financial tech firm is expected to begin trading in Hong Kong on November 5, according to the filing. It’s not yet known when shares will begin trading in Shanghai.

Ant’s debut is slated to bring tech-IPO proceeds to their highest level since the dot-com bubble’s 1999 peak. Strong demand for new offerings has lifted the market from its March slump and reinvigorated IPO dealmaking despite the bleak economic backdrop. July alone saw companies raise $19 billion through listings, the biggest one-month haul since September 2014.

China International Capital Corp. and CSC Financial will underwrite Ant’s Shanghai listing. CICC, Citigroup, Morgan Stanley, and JPMorgan will lead the Hong Kong IPO.

Now read more markets coverage from Markets Insider and Business Insider:

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Intel will plunge 17% as 3 major problems boost headwinds, Bank of American says in downgrade

A blue sweep will create a ‘stock pickers market’ and end secular stagnation — A top US fund manager overseeing $34 billion says these are the 3 sectors to watch

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Pfizer slashing COVID-19 vaccine doses from 100M to 50M due to ‘production quality issues’ – 680 News

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Pharmaceutical giant Pfizer is now expecting to ship only half of its COVID-19 vaccines it originally planned for by the end of this year because of supply-chain problems.

A company spokesperson tells the Wall Street Journal that the scaling up of the raw material supply chain took longer than expected.

Pfizer and it’s German-based partner hoped to roll out 100 million vaccines world-wide by December 31; that plan has now been reduced to 50 million.

The company still expects to ship more than a billion doses in 2021.

In mid-November, Ontario’s Health Minister Christine Elliott said that Canada is expected to receive millions of doses in the coming months.

The country is expected to receive four million doses of Pfizer’s vaccine and two million doses of Moderna’s between January and March.

Subsequently, Elliott said that Ontario will get roughly 1.6 million doses of Pfizer’s vaccine and around 800,000 of Moderna’s for proper distribution.

On Wednesday, Pfizer and BioNTech won permission for emergency use of their COVID-19 vaccine in Britain. The move allowed Britain to become one of the first countries to begin vaccinating its population.

In a series of tweets, Canada’s Health Minister, Patty Hajdu, described the United Kingdom’s decision to authorize the Pfizer’s vaccine as “encouraging.”

The federal government has been facing criticism on vaccines since Prime Minister Justin Trudeau admitted last week that other countries with domestic vaccine production are likely to inoculate their citizens first before shipping doses to Canada.

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3 Cheap TSX Stocks I’d Buy for the 2021 Bull Run – The Motley Fool Canada

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Canadian equity markets have made a robust recovery after bottoming out in March, with the S&P/TSX Composite Index rising over 55% and is trading just 3.4% lower from its all-time high. The strong upward momentum could continue next year, driven by the pent-up demand as the vaccine’s availability inches closer. Goldman Sachs projects the global real gross domestic product (GDP) to grow by 6% next year.

Meanwhile, the pandemic took a severe toll on some of the Canadian stocks. Despite the last month’s recovery, these companies are trading at a discount and are offering excellent buying opportunities for long-term investors. So, here are the three TSX stocks that you should buy for higher returns during the 2021 bull run.

Air Canada

Amid the pandemic, the governments worldwide had imposed travel restrictions, severely impacting the passenger airline industry, including Air Canada (TSX:AC). With several of its aircraft grounded, Air Canada’s passenger volumes fell 96% and 88% in the second and third quarters on a year-over-year basis. It incurred net losses of $2.45 billion and burnt $2.54 billion of cash during the same period.

Meanwhile, the buying in Air Canada’s stock has been returning slowly amid the vaccine hope, with its stock price rising over 75% since the beginning of November. The vaccine could prompt the governments to ease restrictions, potentially boosting its lucrative international travel. Further, Air Canada has taken several initiatives to lower its expenses and cash burn, which is encouraging.

Although it could take a couple of years for the passenger demand to reach its pre-pandemic levels, Air Canada, a market leader, could bounce back more quickly. Despite the recent surge, Air Canada is still trading over 45% lower for this year, proving an excellent buying opportunity for long-term investors.

Enbridge

The oil prices have surged since Pfizer made the encouraging announcement on the vaccine on November 9, as investors grew optimistic about life and business returning to pre-pandemic ways. The surge in oil prices has brought some relief to the energy sector, including Enbridge (TSX:ENB)(NYSE:ENB), which rose over 13% since the beginning of November.

The rise in oil prices could boost its liquid mainline throughput driving its financials. Further, Enbridge continues to make advancements with its $11 billion secured growth projects, with approximately $5 billion left to spend by 2022.

The company’s management hopes that these projects and organic growth within its various segments to generate 5-7% DCF-per-share annual growth until 2022. So, the company’s growth prospects look healthy.

Besides, at 7.8%, Enbridge’s dividend yield looks attractive. Given its stable cash flows and healthy liquidity position, its dividends are safe. The company has consistently hiked its dividends for the past 25 years at a compound annual growth rate (CAGR) of 11%.

Cineplex

The pandemic-infused lockdown and the following restrictions have weighed heavily on Cineplex’s (TSX:CGX) financials. The company, which owns and operates 164 theatres across Canada, has incurred net losses of $98.9 million and $121.2 million in the second and third quarters. Its high cash burn and rising debt levels are also a cause of concern.

Cineplex has currently opened all its 164 theaters but operates them at a limited capacity, as per the local government restrictions. Meanwhile, the vaccine could increase customer footfalls and also aid the company to operate at full capacity. Further, many distributors have shifted the release dates of major movies to next year, which could contribute to the next year’s increased footfalls.

Cineplex has also taken several initiatives to reduce its expenses and cash burn, which is encouraging. Its valuation also looks attractive, with its forward price-to-earnings standing at 17.4.

Meanwhile, if you are looking for high-growth stock to invest, the following report would be of great help.

This Tiny TSX Stock Could Be the Next Shopify

One little-known Canadian IPO has doubled in value in a matter of months, and renowned Canadian stock picker Iain Butler sees a potential millionaire-maker in waiting…
Because he thinks this fast-growing company looks a lot like Shopify, a stock Iain officially recommended 3 years ago – before it skyrocketed by 1,211%!
Iain and his team just published a detailed report on this tiny TSX stock. Find out how you can access the NEXT Shopify today!

Click here to discover how!


The Motley Fool owns shares of and recommends Enbridge. Fool contributor Rajiv Nanjapla has no position in the companies mentioned.

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Canadian bank bonuses climb 3.9% as virus stops 'crazy' payouts – BNN

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Canada’s biggest banks set aside 3.9 per cent more for bonuses, a relatively small increase in a year when record revenue from trading and dealmaking helped firms weather the COVID-19 pandemic.

The country’s six largest lenders set aside $16.2 billion (US$12.6 billion) for performance-based compensation in the 2020 fiscal year. The increase improved upon the previous year’s 2.5 per cent gain — the smallest in nine years — though it fell short of the 6.3 per cent average for the past decade.

“This year is going to be very challenging when it comes to bonuses,” said Bill Vlaad, president of Vlaad & Co., a Toronto-based recruitment firm that monitors compensation trends. “The rest of Canada has had a really challenging year, so the banks can’t then go out and pay investment bankers crazy bonuses. They just can’t do that optically.”

Toronto-Dominion Bank and Royal Bank of Canada, the two largest lenders, had the biggest increases to their bonus pools, while Bank of Nova Scotia — which sold businesses and operations through the year — was the only company to shrink its reserves for performance-based pay.

Banks saw a 22 per cent surge in annual revenue from their capital-markets operations, to about $31.1 billion collectively for the year ended Oct. 31. Underwriting and advisory fees rose 23 per cent to a new peak of $5.66 billion, and trading revenue soared 41 per cent to a record $16.5 billion.

Overall, the Big Six banks had $41.2 billion in annual net income, down 12 per cent from the previous year’s record.

Canada’s bonus reserves may hint what’s ahead for U.S. and European banks. Wall Street traders are poised for handsome bonuses in their best year in a decade, though their investment-banking peers may be less fortunate. Traders at JPMorgan Chase & Co. may see a 20 per cent bonus boost.

In Europe, Deutsche Bank AG signaled in October that it’s planning bonus increases for top-performing investment bankers. UBS Group AG plans to raise fixed salaries for some employees by as much as 20 per cent, allowing the company to lower its bonus pool.

The Canadian banks pay bonuses based on performance, with most of the variable compensation going to capital-markets employees such as investment bankers, research analysts and those in sales and trading. Variable compensation reflects the amount reserved, not paid out, and doesn’t include base salaries. Bonuses are typically distributed in December.

“There aren’t a lot of bonuses to go out when you divide it by the number of people that are still on at the firms,” Vlaad said. “The banks have an unnatural, invisible hand that is coming in and has restricted them from having any material layoffs, so they haven’t been able to be as efficient as they’d like to be because of their promises to the Canadian public.”

The six banks’ workforce totals about 378,400, down 3 per cent from last year, with Scotiabank shrinking the most after selling operations in the Caribbean and winding down other businesses. Bank of Montreal’s and Canadian Imperial Bank of Commerce’s ranks also shrunk after the two companies announced cost-reduction measures before the pandemic. Job cuts across the industry could have been higher if not for COVID-19, with chief executive officers vowing that employees wouldn’t lose their jobs due to the pandemic.

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Here’s a bonus breakdown by bank:

Toronto-Dominion

Canada’s largest lender by assets set aside $2.89 billion for incentive compensation, with its 6.2 per cent increase the highest since 2017. The pool reflects employees’ ability to keep the bank serving customers and running efficiently throughout the pandemic, Chief Financial Officer Riaz Ahmed said in an interview.“Bonuses are linked to performance, and overall some of our businesses have done very well,” he said. “We’ve also made sure we’ve continued to look after all of our people through the pandemic.”

Royal Bank

Royal Bank, which has the biggest capital-markets division among Canadian lenders, set aside $6.04 billion for variable compensation, a 5.9 per cent increase and the highest total for the Big Six.

“We take a very balanced approach to compensation with consideration of the external environment in the long-term interest of both our employees and our shareholders,” CFO Rod Bolger said in an interview. Market-driven businesses such as wealth management and capital markets will see rates “according to what the market pays, and both of those businesses had strong performance this year.”

Still, overall earnings at Canada’s second-largest lender were down, “so a lot of our employees will see lower variable compensation this year,” Bolger said.

Scotiabank

Scotiabank’s performance-based compensation pool fell 1.3 per cent to $1.74 billion, its first decline since 2015, even as Canada’s third-largest lender posted record revenue from its capital-markets operations as trading reached an all-time high.

“It’s not all about ‘eat what you kill’ because we want them to be good corporate citizens,” CFO Raj Viswanathan said in an interview. “We want to compensate them appropriately when they have a good year,” but employees won’t necessarily receive a specific percentage of the business they generate.

Scotiabank’s compensation calculations take into account the company’s performance relative to its projections, and that’s weighing on compensation this year because of how the pandemic hurt business, he said.

“The overall variable compensation of the bank is down because the bank’s performance has been lower” in the second and third quarters, Viswanathan said.

BMO

Bank of Montreal raised its set-asides for variable compensation 0.8 per cent to $2.63 billion, its smallest increase in at least eight years.

“We’re committed to the principles of paying for performance and providing market-competitive compensation for our employees,” CFO Tom Flynn said in an emailed statement. “This year, we are comfortable with how well we have adhered to those principles, for both bonuses and total compensation.”

CIBC

The fifth-largest Canadian lender allocated 4 per cent more for performance-based pay, reserving $1.95 billion, a reversal from the previous year’s 4.7 per cent contraction.

“We believe in paying competitively and paying for performance, and that philosophy is applied,” CFO Hratch Panossian said in an interview. “This year, the level of compensation we’ve landed on we believe reflects the performance of the bank both from a financial perspective as well as doing the right thing for our clients and supporting clients through a very tough environment.”

National Bank

National Bank of Canada set aside 4 per cent more for bonuses, with the Montreal-based lender allocating $990 million for variable compensation, rebounding from a 1.3 per cent contraction in fiscal 2019.

“We’re trying to balance a good year with the fact also that our loan losses did go up during the year and that has to be reflected,” CEO Louis Vachon said in an interview. “In the context of a pandemic, I think our approach to compensation does need to remain relatively sober. So that’s how we’re balancing things out.”

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