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CNFinance Prices IPO at Low End, Raises $49 Million on Wall Street

Shares in the Fanhua-backed lending platform were trading at the offering price of $7.50 per share Wednesday afternoon.

CapitalWatch Staff
    Nov 07, 2018 9:35 AM  PT
CNFinance Prices IPO at Low End, Raises $49 Million on Wall Street

Chinese home equity loan facilitator, CNFinance Holdings Ltd. (NYSE: CNF), debuted on Wall Street today, raising $48.8 million in its initial public offering.

The stock in the Guangzhou-based company, spun off from Fanhua Inc. (Nasdaq: FANH), was trading at its offering price of $7.50 per American depositary share in the afternoon Wednesday.


(Source: Thomson Reuters Eikon)

CNFinance priced the 6.5 million ADSs at the low end of the expected range of $7.50 to $8.50 apiece. At that price, the lending platform holds a market value of $567 million.

The offering was downsized from the $200 million the company targeted before its parent company, Fanhua, which provides insurance and financial services in China, was hit by a report from a California asset-management firm, Seligman Investments, which alleged the financials of the company, including its second-quarter results, showed signs of fraud.

The allegations, which Fanhua denied, led to lawsuits against the company.

In its filing with the U.S. Securities and Exchange Commission, CNFinance said outside investors expressed interest in acquiring $60 million of its IPO, representing 123 percent of the deal.

Roth Capital Partners LLC and Shenwan Hongyuan Securities (H.K.) Ltd. acted as the underwriters on the IPO.