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HK IPOs at their lowest in over a decade as China cracks down | Business and Economy News



New Hong Kong listings are tracking at their slowest pace since the aftermath of the global financial crisis, as weaker markets and China’s clampdown on its biggest tech firms chill sentiment.

Just seven companies have gone public in the second quarter so far — on track for the fewest since 2009, according to data compiled by Bloomberg. The muted second-quarter activity stands in sharp contrast to the rush to go public seen last year or even at the start of 2021.

First-day performances have also struggled: May’s initial public offerings – which includes warehouse and distribution company JD Logistics Inc. and property manager Central China Management Co. – delivered the worst average debut performance in 15 months, the data show.

The cool-off comes as China slapped a record fine on Alibaba Group Holding Ltd. and ordered 34 of its largest tech companies to rectify any anti-competitive business practices. That’s making some firms more skittish about going public and investors worry about further actions from regulators. China has said the moves are to protect consumers and maintain financial stability.

“Investors are no longer comfortable paying sky-high valuations for some companies,” said Louis Tse, Hong Kong-based managing director at Wealthy Securities Ltd. “Because of the intervention of the government, some issuers will have to revise down their multiples.”

China’s top-three tech firms Tencent Holdings Ltd., Alibaba Group Holding Ltd. and Meituan have lost more than $400 billion in value from highs just four months ago. Hong Kong’s stock market tumbled into a technical correction earlier this year, dragging valuations further. The benchmark Hang Seng Index is one of the world’s worst performers since its February high.

As a result, capital raised on the Hong Kong stock exchange this year is only half of its levels last year, impacting the city’s position as a top fundraising hub. In comparison, volume on the Nasdaq has already surpassed its 2020 number, thanks to a boom in blank-check company listings earlier this year.

To be sure, Hong Kong’s year-to-date IPO volume is still more than triple the same period last year, with nearly $23.9 billion raised. Meanwhile, the U.S. SPAC boom is fizzling out.

Growth Trap

Worries about rising inflation are also making tech firms going public a harder sell as investors dump shares with rich valuations. Beijing’s scrutiny on firms including technology and education has also forced investors to scale back earnings forecasts, investors say.

“We have seen some volatility and that has reflected on investors’ appetite, but deals that are priced appropriately will get done,” said Francesco Lavatelli, head of equity capital markets for the Asia Pacific region at JPMorgan Chase & Co.

Fintech firm Bairong Inc. slumped 16% when it began trading in late March, while healthcare company Zhaoke Ophthalmology Ltd. dropped 15% in late April. JD Logistics Inc., which raised $3.2 billion, closed only 3% above its offering price in its debut recently in contrast to another unit, JD Health International Inc., which surged 56% on its first day last year.

Next Blockbuster

The test for whether Hong Kong’s IPO market can stage a revival will come from some upcoming listings, with activity seen to be picking up again with share sales by companies including a dairy firm and a maker of invisible teeth aligners.

Large listings include China Youran Dairy Group Ltd.’s offering of as much as $799 million, which kicked off its roadshow on Monday. Biopharmaceutical firm CARsgen Therapeutics Holdings Ltd. is looking to raise as much as $401 million and also started taking investor orders on Monday.

Angelalign Technology Inc., China’s leading invisible orthodontic producer, launched an IPO of as much as $375 million on Thursday. The latter’s retail tranche was already about 674 times oversubscribed on its first day of order-taking, the Hong Kong Economic Journal reported.

At least three other companies started gauging investor demand for their IPOs on Monday, including Chinese bubble tea chain Nayuki Holdings Ltd. and two property management companies.

Investors are also closely watching the reception to mega flotations, among them Chinese gaming giant NetEase Inc.’s music streaming arm which filed late May for a Hong Kong IPO that could raise about $1 billion.

“The market needs at least two or three blockbuster IPOs to revive the sentiment. That means you need both subscription ratio and first-day performance to surprise the market on the upside,” said Kenny Wen, Everbright Sun Hung Kai strategist. “The good days of the IPO market are not coming back yet.”

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New Zealand’s Hubbard selected as first transgender Olympian | LGBTQ News




Laurel Hubbard, 43, will compete in the super-heavyweight women’s event in Tokyo.

Weightlifter Laurel Hubbard will become the first transgender athlete to compete at the Olympics after being selected by New Zealand for the women’s event at the Tokyo Games, a decision set to test the ideal of fair competition in sport.

New Zealand Olympic Committee chief Kereyn Smith said 43-year-old Hubbard – who was assigned male at birth but transitioned to female in 2013 – had met all the qualification criteria for transgender athletes.

“We acknowledge that gender identity in sport is a highly sensitive and complex issue requiring a balance between human rights and fairness on the field of play,” Smith said in a statement.

Hubbard will compete in the super-heavyweight 87-kg category after showing testosterone levels below the threshold required by the International Olympic Committee (IOC).

The 43-year-old had competed in men’s weightlifting competitions before transitioning.

“I am grateful and humbled by the kindness and support that has been given to me by so many New Zealanders,” Hubbard, an intensely private person who rarely speaks to the media, said in a statement issued by the New Zealand Olympic Committee (NZOC) on Monday.

Hubbard has been eligible to compete at Olympics since 2015, when the IOC issued guidelines allowing any transgender athlete to compete as a woman provided their testosterone levels are below 10 nanomoles per litre for at least 12 months before their first competition.

Some scientists have said the guidelines do little to mitigate the biological advantages of people who have gone through puberty as males, including bone and muscle density.

Advocates for transgender inclusion argue the process of transition decreases that advantage considerably and that physical differences between athletes mean there is never a truly level playing field.

Save Women’s Sport Australasia, an advocacy group for women athletes, criticised Hubbard’s selection.

“It is flawed policy from the IOC that has allowed the selection of a 43-year-old biological male who identifies as a woman to compete in the female category,” the group said in a statement.

Weightlifting has been at the centre of the debate about the fairness of transgender athletes competing against women, and Hubbard’s presence in Tokyo could prove divisive.

Her gold medal wins at the 2019 Pacific Games in Samoa, where she topped the podium ahead of Samoa’s Commonwealth Games champion Feagaiga Stowers, triggered outrage in the host nation.

Samoa’s weightlifting boss said Hubbard’s selection for Tokyo would be like letting athletes “dope” and feared it could cost the small Pacific nation a medal.

Belgian weightlifter Anna Vanbellinghen said last month allowing Hubbard to compete at Tokyo was unfair for women and “like a bad joke”.

Australia’s weightlifting federation sought to block Hubbard from competing at the 2018 Commonwealth Games on the Gold Coast but organisers rejected the move.

Hubbard was forced to withdraw after injuring herself during competition, and thought her career was over.

“When I broke my arm at the Commonwealth Games three years ago, I was advised that my sporting career had likely reached its end,” Hubbard said on Monday, thanking New Zealanders.

“But your support, your encouragement, and your aroha (love) carried me through the darkness.”

Olympic Weightlifting New Zealand President Richie Patterson said Hubbard had worked hard to come back from the potentially career-ending injury.

“Laurel has shown grit and perseverance in her return from a significant injury and overcoming the challenges in building back confidence on the competition platform,” he said.

Hubbard is currently ranked 16th in the world in the super heavyweight category.

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Apple Daily could shut ‘in days’ after Hong Kong asset freeze | Freedom of the Press News




Company adviser says action under security law means it cannot access some $50 million in funds to pay staff and vendors.

Hong Kong pro-democracy newspaper Apple Daily will be forced to shut “in a matter of days” after authorities used the national security law imposed by China to freeze the company’s assets as it arrested the paper’s editor and four other directors, an adviser to jailed tycoon Jimmy Lai told Reuters on Monday.

Mark Simon, speaking by phone from the United States, said the company was no longer able to access its funds and would be holding a board meeting on Monday to discuss how to move forward.

“We thought we’d be able to make it to the end of the month,” Simon told the news agency. “It’s just getting harder and harder. It’s essentially a matter of days.”

His comments signal closure is imminent even after Apple Daily said on Sunday the freezing of its assets had left the newspaper with cash for “a few weeks” for normal operations.”

The news comes two days after editor Ryan Law, 47, and chief executive Cheung Kim-hung, 59, were denied bail after being charged under the security law with collusion with foreign forces.

Apple Daily’s editor-in-chief Ryan Law arrives back at the detention centre after he was remanded in custody on Saturday [Lam Yik/Reuters]

Three other senior executives were also arrested last Thursday when 500 police officers raided the newspaper’s offices in a case that has drawn condemnation from Western nations, human rights groups and the chief United Nations spokesperson for human rights.

The three have been released on bail.

Simon told Reuters it had become impossible to conduct banking operations.

“Vendors tried to put money into our accounts and were rejected. We can’t bank. Some vendors tried to do that as a favour. We just wanted to find out and it was rejected,” he said.

Speaking earlier to US news channel CNN, Simon said the company had about $50 million available, but was unable to access the funds.

The publisher has come under increasing pressure since its owner Jimmy Lai was arrested under the national security law last August, which marked the first time the company’s headquarters was raided. Lai, 73, is now jailed and facing trial under the national security law. In May, the authorities also froze some assets belonging to the longtime critic of Beijing has also had some of his assets frozen.

Three companies related to Apple Daily are also being prosecuted for collusion with a foreign country and authorities have frozen HK$18 million ($2.3 million) of their assets.

China imposed the national security law on Hong Kong last June saying it was necessary to restore “stability” to a territory that had been rocked by mass protests in 2019, some of which turned violent.

The broadly-worded law criminalises acts such as subversion, sedition, collusion with foreign forces and secession with possible life imprisonment, but critics have said it is being used to suppress legitimate political debate with dozens of pro-democracy politicians and activists among the more than 100 arrested since it was brought into force.

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Birmingham Classic: Ons Jabeur beats Daria Kasatkina to win first title




Tunisian second seed Ons Jabeur defeated Russia’s Daria Kasatkina in straight sets to win her first singles title at the Birmingham Classic.

World number 24 Jabeur triumphed 7-5 6-4 against the fourth seed to become the first Arab woman to win a WTA title.

In Berlin, Russian qualifier Liudmila Samsonova stunned Swiss fifth seed Belinda Bencic to win her first title.

The 22-year-old world number 106 battled back from a set down to win 1-6 6-1 6-3 in her first final.

Victories for Jabeur and Samsonova mean there have now been 10 first-time singles winners on the women’s Tour this year.

Jabeur broke Kasatkina’s serve three times to prevail in the first set, before successive breaks at the start of the second put the 26-year-old in control at 4-0.

Two-time Grand Slam quarter-finalist Kasatkina recovered to 4-3, but Jabeur held on to win a singles final at the third attempt.

It was a breakthrough week for Samsonova in Germany, during which she also defeated seventh seed Victoria Azarenka of Belaurus in the semi-final.

World number 12 Bencic won the first five games as she dominated the opening set, but Samsonova matched that feat in the second before completing her comeback with breaks in the first and ninth games in the deciding set.

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