NetEase, a Chinese gaming giant, gained at least $2.7 billion in its secondary offering in Hong Kong. NTES stock on Nasdaq is up 2.75% now.
Barely eight days after the report from Chinese gaming firm NetEase Inc (NASDAQ: NTES) confirmed it would file for a secondary listing in Hong Kong, there is good news from the company. The firm is reported to have made at least $2.7 billion in its secondary offering. NetEase moved for secondary listing after Alibaba Group Holding Ltd (NYSE: BABA) did the same in 2019. NetEase listing is now one of the most prominent secondary deals in Hong Kong. However, it was tipped to be that beforehand.
According to Reuters, the gaming firm shares traded at HK$123 ($15.87) each, selling 171 million shares. Each stock traded in Hong Kong was 2 percent cheaper than its Thursday’s closing price at Nasdaq. Reportedly, the NetEase plan was to sell 171.48 million shares, with the option of offering 25.72 million more shares, under a so-called ‘greenshoe’ option.
NetEase, in its regulatory filing, explained that funds raised in its secondary listing in Hong Kong would be deployed to fuelling the firm’s expansion plans.
NetEase Recent Exploit in the Gaming World
Just like Tencent (OTC: TCEHY), another American based gaming firm, NetEase offers similar products. Both firms have been critical as regards their expansion plans. The Chinese second gaming giant recently reported a 14 percent rise in online games revenue for the coronavirus-stricken March quarter. However, it is quite little compared to what Tencent made that period.
NetEase, in the same light, is looking to expands its brand globally. It had partnered with Japan’s Studio Ghibli and investing in Canadian game creator Behaviour Interactive. This is outside its secondary listing taken upon to get funs to fuel many other expansion plans.
At press time, NetEase (NASDAQ: NTES) stock was up 2.75% and trading at $416.13. Coinspeaker reported days back that two possible reasons could have facilitated NetEase secondary listing in Hong Kong. Firstly, it could be a resultant factor of rising geopolitical tension between China and the U.S. and secondly, it could be because of the success of Alibaba Group Holding Ltd (NYSE: BABA) recorded in raising capital in Hong Kong.
Muhaimin is a journalist, a fintech and crypto enthusiast who is passionate about its development in Africa and across the globe. Muhaimin derives pleasure in reporting and analysing happenings in the crypto world and a believer in Blockchain technology.