The China Investment Corporation has made a $40 million cornerstone investment in the US initial public offering of China-based iKang Healthcare Group, according to a disclosure with the US Securities and Exchange Commission.
The $575 billion sovereign wealth fund will reportedly own a 4.6 percent stake in the business after the transaction is completed.
Beijing-based iKang is seeking to raise up to $175 million through an IPO in the US, offering over 7.5 million existing American depositary shares and issuing 3.3 million new American depositary shares, according to its IPO prospectus.
The price has been estimated at between $12 and $14 per share.
Other investors have previously taken private stakes in iKang. In April last year, Goldman Sachs and Singaporean sovereign wealth fund GIC Private invested about $100 million in the business.
As US investors warm up to Chinese stocks, China-based companies have begun to reconsider listing their businesses on stock exchanges in the US.
Earlier this month, Alibaba Group, the Chinese e-commerce giant led by Jack Ma, announced it would be seeking its IPO in the US rather than Hong Kong due to the flexibility offered in the US with regards to a dual-share listing – when a few insiders control the board despite having a minority shareholding, Private Equity International reported earlier.
The move sparked concerns that Hong Kong would lose its competitiveness in international capital markets as a place for large companies to IPO.
However, this week Chinese state-owned conglomerate Citic Group gave some hope for the exchange, saying it is planning to list in the PRC’s special administrative region – a rare offshore listing of a mainland SOE, media reports said.