The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2020 Euromoney, a part of the Euromoney Institutional Investor PLC.

Chunghwa ADR hangs fire on pricing

Participants in Chunghwa Telecom's on-off American depositary receipt (ADR) issue are playing a game of bluff and double bluff as they amass support for a dignified climbdown on the deal's pricing stalemate.


The Taiwanese company's international issue will happen, observers believe - the trick will be in bringing it at a price that will sell while enabling the Taiwan government to save face.


The ADRs, which are central to the government's privatization plans and Chunghwa's independence ambitions, were put on hold in January amid disagreements on pricing between the government and underwriters Goldman Sachs, Merrill Lynch and UBS Warburg.


Chunghwa and the government are still reeling from a disastrous IPO last year, blamed partly on over-optimistic pricing, after the government fixed a minimum issue price of NT$104. Less than 3% of the company was sold to the public, compared with a target of 16%.


With stock prices falling and several other telecom companies coming to market, the underwriters are fighting hard to convince the transport and communications ministry of the need for more realistic pricing this time round.





Take out a complimentary trial

Take out a 7 day trial to gain unlimited access to Euromoney.com and Asiamoney.com analysis and receive expertly-curated updates direct to your inbox.

 

Already a user?

Login now

 

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree