AIA seeks $20b in IPO

AIA Group Ltd said Sunday it could raise up to 20 billion US dollars in its global public offering this month, putting it on track to be the world's second biggest IPO of 2010.
Announcing details of the sale at a press conference in Hong Kong, the Asian unit of US insurer AIG said it said it will initially offer 5.86 billion shares at between 18.38-19.68 Hong Kong dollars each, or up to 15 billion US dollars.
It said it could issue up to 8.08 billion shares if it exercised a greenshoe option, which would bring the total raised to around 20 billion US dollars and leave AIG with a stake of just 32.9 percent stake.
"This IPO serves as a great catalyst for the next and exciting phase in the AIA's history," Mark Tucker, group executive chairman and chief executive officer, said via a live video feed from the United States.
"With the global offering, AIA will become the only independent, listed life insurance group exclusively focused on the Asian growth opportunity -- the first of its kind in the life insurance sector," said Tucker.
Earlier this year, Agricultural Bank of China raised a total of 22.1 billion dollars from an IPO, exceeding the previous record set by the Industrial and Commercial Bank of China, which raised 21.9 billion dollars in 2006.
Shares in AIA will be offered from Monday to Thursday, with trading expected to begin on October 29.
The US insurer, which is looking to repay US taxpayers after a government bailout in 2008, won approval last month for the sale of its Asian unit.
AIG was forced to look again at the option of publicly floating AIA in Hong Kong after the collapse in June of Prudential's 35.5-billion US dollar takeover bid for the company.
Among the cornerstone investors are the Kuwait Investment Authority, the oil-rich Gulf emirate's sovereign wealth fund, and a number of Hong Kong tycoons.
The Kuwait fund, as well as Chow Tai Fook Nominee Ltd, NWS Financial Management Services and six other companies have agreed to buy a total of about 1.9 billion US dollars worth of shares at the final offer price, AIA said.
Chow Tai Fook Group is a jewellery enterprise owned by Hong Kong billionaire Cheng Yu-tung, with a total market value of over 256 billion Hong Kong dollars (33 billion US)
Cheng -- listed by Forbes as the 106th richest man in the world -- also owns NWS Holdings Limited, a subsidiary of New World Development Company, which is involved in transport and financial services in Hong Kong.