Reverse engineering

7 November 2018 By Alec Macfarlane Follow @AlecMac11

Roughly a month after a pared-down listing, the $1.3 bln investment bank and boss Fan Bao are buying a chunk of stock on the market. Companies globally are splurging on shares, and the gambit has improved prices a little. Investors and clients, though, will need more substance.

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Investment bank China Renaissance, which focuses on advising Chinese technology companies, said on Oct. 26 that it would buy back up to HK$400 million ($51 million) of its stock on the open market. Under its current shareholder mandate, it can buy back up to 10 percent of total shares in issue.

The company, founded by former Credit Suisse and Morgan Stanley banker Fan Bao, listed its shares on the Hong Kong stock exchange on Sept. 27.

That initial public offering was priced at HK$31.80 per share, the bottom of the marketed range. The shares closed at HK$13.90 the day before the buyback programme was announced on Oct. 26, less than half the IPO price.

The company’s stock has since recovered to trade at just over HK$19 in morning trade on Nov. 7.

China Renaissance said on Oct. 26 that the buyback plan “reflects the confidence of the board and the management team in the long-term strategy and growth of the company”.

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