FAST NEWS: Miniso Applies for Dual Primary Listing in Hong Kong

The latest: Miniso Group Holding Ltd. (MNSO.US) filed to make a second primary listing in Hong Kong to complement its existing U.S. listing. It also said it plans to unwind its weighted voting rights (WVR) structure after the Hong Kong listing.

Looking up: A second listing in Hong Kong would provide a venue for the company’s shares to continue trading even if the U.S. Securities and Exchange Commission (SEC) carries through on recent threats to delist U.S.-traded companies that fail to comply with the Holding Foreign Companies Accountable Act (HFCAA). The SEC has put 11 companies on a list that could face such delisting, though Miniso is not among them.

Take Note: Cancellation of the WVR structure will cause Miniso founder Ye Guofu to lose his “super voting rights,” thus reducing his influence at the company.

Digging Deeper: A dual primary listing means that Miniso will count both the U.S. and Hong Kong as its primary listing places. To achieve such status, companies must not only comply with U.S. listing rules, but must also meet the same listing requirements for Hong Kong IPOs, which includes set standards for profitability, revenue and market capitalization. Some U.S.-listed companies that have recently floated shares in Hong Kong have done so using the less rigorous route of making secondary listings. Unlike those secondary listings, shares of companies with dual primary listings can become traded on the Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect programs, making those shares available to mainland Chinese investors. As a result of that greater liquidity, more U.S.-listed Chinese companies floating shares in Hong Kong have recently opted for dual primary listings. Some with secondary listings in Hong Kong, such as Bilibili (BILI.US; 9626.HK), are also trying to switch to dual primary status.

Market Reaction: Miniso shares fell 3.6% to $7.80 in Thursday trade in New York. The stock now trades at the low end of its 52-week price range.

Translation by Jony Ho

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