Asian insurer FWD moves to shelve U.S. IPO

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Hong Kong billionaire Richard Li’s FWD Group Holdings Ltd. has moved to withdraw its multibillion-dollar initial public offering in New York, the company said, amid rising tensions between China and the U.S.

The company, which is the insurance business of Mr. Li’s Pacific Century Group, is considering other alternatives, it said in a Monday filing. It asked the U.S. Securities and Exchange Commission to approve the withdrawal of its registration statement.

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FWD is exploring a listing in Hong Kong, where the company has more brand recognition among consumers and potential investors, according to a person familiar with the matter. Geopolitical tensions between Beijing and Washington and how they could affect market conditions were also considerations in the decision to shelve the IPO, the person added.

The seal of the U.S. Securities and Exchange Commission hangs on the wall at SEC headquarters in Washington, June 24, 2011. Picture taken June 24, 2011. To match Special Report SEC/INVESTIGATIONS REUTERS/Jonathan Ernst (Reuters/Jonathan Ernst)

The Wall Street Journal last week reported FWD was cooling on plans to list in the U.S.

FWD last week said it was raising more than $1.4 billion from new and existing investors by issuing new shares to pay down debt. The fundraising valued the Hong Kong company at about $9 billion after including the new money, and proceeds would help the company deleverage before it goes public, the Journal reported.

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The financial decoupling between the U.S. and China is escalating, with Chinese ride-hailing giant Didi Global Inc. earlier this month saying it plans to delist shares in the U.S. and pursue a listing in Hong Kong. In late 2020, then-President Donald Trump signed a law that bans the trading of securities in foreign companies whose audit working papers can’t be inspected by U.S. regulators for three years in a row. That has led to a countdown that will force many Chinese companies to leave U.S. exchanges.

The Biden administration has also added dozens of Chinese companies and research institutes to blacklists restricting access to U.S. investment and technology for their alleged support for China’s military and the mass surveillance of mainly Muslim ethnic groups. SenseTime Group Inc., a Chinese developer of facial-recognition technology, briefly delayed its plans for an IPO of shares in Hong Kong after being placed on a U.S. investment blacklist, before relaunching the deal this week.

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