Ant’s Shanghai retail book for mega listing oversubscribed 872x

Backed by Chinese internet titan Alibaba, Ant has decided to exercise a greenshoe option – a provision in an underwriting agreement that grants the right to sell investors more shares than initially planned by the issuer – for a 15% overallotment of shares, according to an October 29 filing. It’s now selling over 1.9 billion shares on Shanghai’s Star Market.

The company originally offered to sell roughly 1.7 billion shares on the Shanghai exchange at 68.8 yuan (US$10.26) apiece to raise 114.9 billion yuan (US$17.1 billion). Ant also issued the same amount in Hong Kong at HK$80 (US$10.32) per share to rake in HK$133.6 billion (US$17.2 billion).

The huge investor interest in Ant’s IPO also triggered a clawback mechanism, which allows small investors with heavy oversubscription to receive a greater share, according to the latest filing.

With the greenshoe and clawback enforcements, the final allocation would see strategic investors taking 70%, while institutional and retail investors split the rest of 12% to 18% between them, instead of the originally planned 4% to 16%.