Bilibili moves ahead with dual-primary listing bid
Nasdaq-listed short-video platform Bilibili expects to convert its secondary listing status in Hong Kong into a dual-primary listing by October 3, the company said in a stock exchange filing.
The company, which raised US$2.6 billion in Hong Kong in March last year through a secondary listing, said it had already applied and gained the green light from the stock exchange to proceed with its conversion proposal. It listed on the Nasdaq in March 2018.
The Shanghai-based platform said it would need to make a number of changes to its internal controls, disclosure and certain staffing arrangements to meet Hong Kong’s listing rules and facilitate the primary listing in the city. It also needs shareholders’ approval and final clearance from the stock exchange for its conversion plan.
For example, the firm will need to appoint a local qualified company secretary and detail the differences between its accounting treatment in the United States and Hong Kong to shareholders.
It expects the conversion to the dual-primary status to become effective on or around October 3.
Bilibili said the move was due to “the significant increase in the trading volume of the shares on the stock exchange since the secondary listing in Hong Kong, the nexus between Hong Kong and the principal business operations of the company in the People’s Republic of China, as well as the long-term business development and prospects of the company”.
A dual-primary listing will enable the company to be potentially included in the Stock Connect schemes, a mutual market access mechanism that allows mainland investors to trade Hong Kong stocks and vice versa. This option is not available to companies listed through secondary flotations.
Bilibili is among a host of US-listed mainland companies seeking secondary or primary flotations closer to home as a hedge against the risk of being kicked off American exchanges over stricter audit requirements.
The Holding Foreign Companies Accountable Act, which came into effect in late 2020, requires US-listed foreign firms to comply with audit inspection rules under the Public Company Accounting Oversight Board or face the risk of being delisted from US stock exchanges after three consecutive years of non-compliance.
Shares in Bilibili are down by around 75 per cent from their offering price last March following a months-long crackdown on the tech sector by Beijing.
Separately, Shenzhen Pagoda Industrial (Group) Corporation, the largest fruit retail operator in China, also filed a listing application to the Hong Kong stock exchange’s main board.
The company sells fruit through multiple e-commerce platforms, including Alibaba Group Holding’s Tmall and JD. com, as well as through 5,351 physical stores located in more than 130 mainland cities.
Its revenue increased by 16.2 per cent to 10.29 billion yuan (HK$12.2 billion) last year, the company said in its filing.