China’s richest eye Xiaomi IPO despite Shanghai index slump

As smartphone giant Xiaomi Corp readies itself for a mammoth IPO in Hong Kong, China’s billionaires are circling for a slice of the pie. These elite include the triumvirate of Li Ka-shing, Pony Ma, and Jack Ma.

Former Chairman of CK Hutchison Holdings, Li Ka-shing is said to have planned a whopping $30 million buy for a yet-to-be-disclosed share of Xiaomi, while Tencent chief Pony Ma and Alibaba founder Jack Ma – the richest men in China – also plan to invest heavily in the Apple competitor. Xiaomi is expected to raise at least $6 billion, and might even surpass the coming out party of Postal Savings Bank of China Co, which raised more than $7.5 billion back in 2016.

It is also expected that international giants such as China Mobile and Qualcomm Inc might also pour money into the IPO, making it quite a Page-3 event as far as business deals are concerned.

The Hong Kong Economic Journal first reported Li Ka-shing’s deal, and it is expected to raise the positive sentiment for the stock, given that Li enjoys a celebrity-status among HKeX investors.

Chinese stocks fall

As the bear attacked the benchmark, The Shanghai Composite Index, Chinese stocks fell, especially on US trade war fears. The market also saw investors ignore government checks including the reserve-ratio cut over the weekend. From January high, the slide has now wiped about $1.8 billion from the market.

Many analysts also cite that if the trend continues, it will really affect companies with higher dollar-debt.

The Shanghai Composite Index has now slid 14% – the most among major benchmarks. This has invited a troubling time for the Chinese government in Beijing, whose efforts seem to have gone in vain. China’s broadest measure of new credit slumped in May to the lowest in almost two years, data this month showed.