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Business Mayor
20-05-2025
- Automotive
- Business Mayor
Shares in China's CATL jump over 18% in Hong Kong debut as battery maker rides EV boom
Shares of CATL debut in Hong Kong on May 20, 2025. Sopa Images | Lightrocket | Getty Images Shares of the world's largest battery manufacturer Contemporary Amperex Technology rose over 18% in their Hong Kong trading debut on Tuesday, as investors bet on the company's ability to ride the boom in electronic vehicles. Shares were last trading at 308 Hong Kong dollars apiece on the Hong Kong stock exchange, compared with the initial public offering price of HK$263 dollars per share. CATL IPO raised HK$35.7 billion ($4.6 billion) according to a company filing, reportedly making it the largest global listing in 2025. CATL shares, which had opened lower on mainland China's Shenzhen stock exchange, reversed course to rise 1.5% to 264 Chinese yuan. 'I think that as the H [Hong Kong] shares continue to perform strongly, that will pull up the A [mainland China] shares,' Neil Beveridge, senior research analyst at Bernstein, told CNBC's 'The China Connection.' 'For the H shares to be trading above the A shares just shows how exceptional the demand is for this company, particularly from global investors,' he added. CATL said in its Hong Kong filing that 90% of the funds raised will go toward building its upcoming factory in Hungary, aimed at supplying batteries to European automotive clients including Stellantis , BMW and Volkswagen . 'Europe is an exceptionally important market for CATL,' said Beveridge, adding that the company's growth in China was going to slow over the coming years due to already high sales penetration. 'Europe's only at about 20-25% [sales] penetration, so there's still a lot of growth there to come,' he added. The company's push into Europe coincided with global expansions from leading Chinese EV makers such as BYD. These efforts also come amid increased scrutiny from the U.S. and EU, which placed punitive tariffs on EVs made in China last year, citing unfair trade practices. CATL found itself in the crosshairs of U.S.-China trade earlier this year, with the Pentagon putting it on a watchlist in January over suspected links to China's military — allegations the company has rejected. According to Bill Russo, founder and CEO of investment advisory firm Automobility, the watchlist designation, coupled with Trump's latest tariffs on China, may complicate the company's U.S.-related business. However, the impact on its global ambitions will likely be limited unless broader multilateral restrictions follow, as CATL's core strategy remains focused on markets such as Europe and emerging regions, he said. Weekly analysis and insights from Asia's largest economy in your inbox Subscribe now In March, CATL posted a 9.7% drop in its 2024 annual revenue, hit by intense competition in China's electric-vehicle market that pressured the world's top battery producer. Still, the company's net profit went up by 15% year over year. Demand for electric vehicles in China, a critical market for CATL, gained momentum last year on the back of a combination of subsidies and consumer purchase incentives. EV sales in China surged to 11 million in 2024 — a 40% increase compared to the previous year, data from U.K. research firm Rho Motion showed. 'We're a big believer and investor in CATL in our global EV strategy. It's just phenomenal, it's a 'must own company,' in my opinion, along with BYD for investors in the space,' said Brendan Ahern, chief investment officer at KraneShares. Bank of America, China International Capital Corporation, Goldman Sachs, Morgan Stanely, JPMorgan Chase were the joint lead mangers for the Hong Kong offering. Speaking on CNBC's Squawk Box Asia on Tuesday, Andy Maynard, managing director and head of equities at China Renaissance, said that the CATL's IPO shows that investors still look to China to find quality plays despite recent trade tensions between Beijing and Washington. Correction: This story was revised to accurately reflect the jump in shares at market open.
Business Mayor
15-05-2025
- Business
- Business Mayor
Cybersecurity firm Proofpoint to buy European rival for $1 billion as it eyes IPO
Pavlo Gonchar | Lightrocket | Getty Images Cybersecurity firm Proofpoint announced Thursday it will acquire European rival Hornetsecurity for $1 billion to strengthen its European presence as it explores a return to public markets. The deal marks the single largest acquisition in Proofpoint's history. The cybersecurity industry has seen heightened consolidation in recent months, with companies snapping up smaller competitors to bolster their offerings in an era of AI-fueled cybercrime. In March, Google announced a deal to acquire Israeli-founded cloud security startup Wiz for $32 billion, while last month Palo Alto Networks said it was buying AI-focused cyber startup Protect AI. Proofpoint, which is currently owned by private equity giant Thoma Bravo, said the deal to buy Hornetsecurity would help deepen its expertise in the managed service provider (MSP) ecosystem. Headquartered in Hannover, Germany, Hornetsecurity specializes in managed cloud-based email security services to help protect firms from cyberattacks, data loss, and compliance risks associated with Microsoft 365 and other IT infrastructure. Proofpoint CEO Sumit Dhawan told CNBC the deal would help 'consolidate fragmented security tools into a unified platform that protects people and defends data across the global threat landscape.' 'Generative AI has fundamentally changed the threat landscape, enabling faster, more targeted, and more complex attacks,' Dhawan said in an interview. Small and medium-sized firms 'are increasingly in the crosshairs' of hackers and require 'integrated, high-efficacy' solutions, he added. Path to IPO 'It contributes significantly to our earnings and cash flow going forward, which makes us an even stronger company and business as we explore a return to public markets,' he added. Dhawan said that while there is 'nothing new' to share on Proofpoint's IPO plans for now, 'we remain interested in the IPO market and will explore public markets when we feel the time is right.' Hornetsecurity serves more than 125,000 small to medium-sized businesses and has more than 700 employees, according to a press release. Proofpoint has over 4,500 employees and counts 85% of the Fortune 100 as customers. The deal is expected to close in the second half of 2025, subject to customary closing conditions. READ SOURCE
