On July 28, four Chinese companies, including battery firms Gotion High-Tech and Ningbo Shanshan, electronic waste recycling firm GEM, and building materials machinery manufacturer Keda Industrial were officially listed to the SIX Swiss Exchange.
Gotion High-Tech, which was listed on the Shenzhen Stock Exchange (SZSE) in 2015, issued global depository receipts (GDRs) on the SIX Swiss Exchange at an issue price of $30 each, raising a total of about $685 million. This is the largest IPO in the Swiss capital market this year.
Ningbo Shanshan, which was established in 1992, has been transformed from a garment enterprise to a new energy enterprise. Its existing business covers lithium-ion battery materials, lithium-ion capacitors, battery packs, charging pile construction, and more. The Swiss listing raised about $319 million for the company.
The final issue price of GEM is $12.28 per GDR, and the raised funds will be used to support the production and operation of its overseas nickel mine projects and the development of overseas battery materials projects. GEM, which was listed on Shenzhen Stock Exchange in January 2010, focuses on new energy materials business. It disposed digital waste of over 5 million tons every year, while its ternary power battery precursor materials business accounts for 15% of the global market.
Among the companies that issued GDRs this time, Keda Industrial was the first to obtain listing approval from the SIX Swiss Exchange, raising a total of $173 million. The company was listed on the Shanghai Stock Exchange as early as 2002, and its latest market value has reached nearly 40 billion yuan ($5.9 billion).
At present, more Chinese companies are waiting to carry out an IPO in Switzerland, including battery firm Sunwoda, construction machinery firm SANY Heavy Truck, sports drink brand Eastroc Beverage, wafer chip manufacturer Weil, and medical device manufacturer Lepu Medical.
The SIX Swiss Exchange in Zurich is the third-largest stock exchange in Europe, which was established in 1993. By the beginning of 2022, there were about 230 listed companies on the SIX Swiss Exchange, with a total market value of about $2 trillion and an average market value of about $9 billion. The listed companies of the SIX Swiss Exchange are mainly from consumption, finance, health, materials and other industries, including European giants such as Nestle and Roche, as well as large international enterprises such as Lilly Medicine and PepsiCo.
In February this year, China issued the “Regulation on Interconnection of Depositary Receipts Business Between Chinese and Overseas Stock Exchanges,” expanding the scope of application. In China, qualified listed companies of the Shenzhen Stock Exchange (SZSE) were included, while overseas, the stock exchange scope was expanded to major European markets such as Switzerland and Germany. With the introduction of this regulation, A-share listed companies began to go public in Switzerland.
The issuance and approval process of Swiss GDRs is relatively simple, and it can usually be completed in about three or four months. In addition, when enterprises choose to list on the SIX Swiss Exchange, they can get in touch with Swiss investors and international investors with sufficient capital and rich experience.
In the past, the US was the first choice for Chinese enterprises to list overseas. However, since the beginning of this year, the SEC in the US has published several rounds of “pre-delisted” Chinese companies, which makes it difficult to go public in the country. Jos Dijsselhof, CEO of the SIX Swiss Exchange, said in an interview with Chinese media earlier that “the door of the SIX Swiss Exchange will be open to tech firms that think that the listing process in the United States is too long. Compared with the United States, Switzerland may be a better place to start the listing.”