April 23, 2018 / 9:40 AM / a year ago

Techcombank to price Vietnam's biggest IPO at top end, raise $922 million: source

SINGAPORE (Reuters) - Vietnam Technological and Commercial Joint Stock Bank is set to price its global equity offering at the top end of an indicative range, raising roughly $922 million and marking the country’s biggest-ever IPO, a source familiar with the matter said.

The pricing underlines strong demand for equity issues in Vietnam as the government speeds up a privatization drive and the private sector expands furiously. Vietnam’s benchmark index .VNI rose 50 percent last year to rank as Asia’s best performer and is currently just below its record high.

The largest private sector lender in Vietnam is expected to price 164 million shares or 14.1 percent of its equity capital at 128,000 dong ($5.62) each, compared with a marketed range of 120,000-128,000 dong each, the source said on Monday on condition of anonymity as pricing terms have not been announced.

Techcombank declined comment.

Reflecting the high level of participation from funds, cornerstone investors such as Singapore sovereign wealth fund GIC [GIC.UL], Fidelity Management and Research and local fund Dragon Capital snapped up 76 percent of the IPO, one of the largest for any Vietnam IPO, Reuters reported last week.

At the top end, the IPO will value Techcombank at about $6.5 billion and rank it among the top 10 listed local companies. Techcombank will be listed on the Ho Chi Minh Stock Exchange.

The 25-year-old lender got a boost last month when Warburg Pincus agreed to invest more than $370 million in the bank, in the largest ever private equity investment in Vietnam.

The IPO will be bigger than Vincom Retail’s VRE.HM equity offering that raised about $700 million last year.

Vietnam is set to host other big IPOs this year, including the listing of Vingroup JSC’s VIC.HM residential property business that could raise as much as $2 billion, sources familiar with the matter have said.

The country’s main index is up 9 percent so far this year but has lost 11 percent from a record high struck this month.

Techcombank provides a broad range of banking products and services to more than 5.4 million customers in Vietnam through an extensive network of 315 branches.

Morgan Stanley, Viet Capital Securities and Deutsche Bank are the joint global coordinators for Techcombank’s IPO.

Reporting by Anshuman Daga; Editing by Himani Sarkar

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