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NetEase's Cloud Village to price Hong Kong IPO shares at HKUS$205 each, sources say

HONG KONG :NetEase Inc's Chinese music streaming business Cloud Village Inc will price it shares at around HKUS$205 each, raising almost HKUS$3.28 billion (US$421 million) in its Hong Kong initial public offering (IPO), two sources with direct knowledge of the matter said.

The sources could not be identified as the information has not yet made public.

NetEase declined to comment on the pricing.

The final price sits at the mid point of the HKUS$190 to HKUS$220 range flagged when the deal launched on Tuesday.

The deal's bookbuild was carried out amid a renewed bout of volatility in the region's tech stocks.

Hong Kong's Hang Seng Tech Index dropped 3.25per cent on Friday which took its weekly decline to 4.74per cent.

Cloud Village was selling 16 million shares in the IPO and retains the option to sell another 2.4 million shares once the stock starts trading as part of a so-called overallot option.

Its shares will begin trading on the Hong Kong Stock Exchange on Dec. 2.

The IPO is its second attempt to list this year. The company shelved its initial plan to raise US$1 billion in August after Chinese regulators ordered a broad toughening of rules governing the country’s tech companies after Didi Global Inc's listing in the United States.

The changes prompted a global sell off of Chinese tech stocks and soured sentiment towards Cloud Village’s deal, sources told Reuters at the time.

Instead, Cloud Village held off and scaled down the size of the deal to win investors' support.

A large chunk of the IPO had already been sold ahead of the launch with US$350 million signed up from cornerstone investors in NetEase, Sony Music and Orbis Funds.

(Reporting by Scott Murdoch in Hong Kong; Editing by Edmund Blair and Kim Coghill)

Source: Reuters


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