On September 9th, Midea Group announced in a pre-market filing on the Hong Kong Stock Exchange its intention to conduct an initial public offering (IPO) in Hong Kong, with a total global offering of 492 million H shares, expected to raise up to $3.5 billion.

The announcement stated that among the 492.1 million H-shares, Hong Kong public offering accounts for about 5.0% (about 24.6068 million shares), international offering accounts for about 95.0% (about 468 million shares), and the offering price ranges from HKD 52 to HKD 54.80 per share, with 100 shares per lot; It is expected that H shares will be listed on September 17, 2024. This also means that once successfully listed, Midea may become the largest IPO project in the Hong Kong stock market this year.

Midea's path to listing has been relatively smooth. Public records show that in August of last year, Midea Group first announced its plan to go for a secondary listing on the Hong Kong Stock Exchange. In October, Midea officially submitted its application to the HKEx. In April of this year, Midea updated its application for issuance and published updated application materials on the HKEx website. In July of this year, Midea announced that it had received the relevant filing notice and was preparing for the official listing.

Midea announced that Midea Group has entered into a cornerstone investment agreement with cornerstone investors, who have agreed, subject to certain conditions, to subscribe for or cause their designated entities to subscribe for a certain number of shares available for purchase at the offering price, totaling approximately $1.256 billion.

The cornerstone investors for Midea Group's Hong Kong IPO include COSCO Shipping (Hong Kong), UBS AM (Singapore), China National Development Fund Phase II, Golden Link (wholly owned by BYD's wholly-owned subsidiary BYD (Hong Kong)), and Splendor Achieve Limited, among others.

The prospectus data shows that Midea Group is a leading global, technology-driven provider of smart home and commercial and industrial solutions. Through its smart home business, it provides consumers with a variety of household appliances; through its commercial and industrial solutions, it offers various solutions for enterprise customers, such as home appliance compressors and motors, commercial air conditioning, industrial robots, and supply chain services.

The data also indicates that, based on 2023 sales and revenue, Midea Group is the world's largest home appliance company, with a market share of 7.9%. In 2023, based on sales volume, Midea Group ranked among the top three globally in the categories of home air conditioners, washing machines, refrigerators, and kitchen and other home appliances, with market shares of 23.7%, 14.2%, 10.5%, and 6.0%, respectively. During the same period, based on retail sales, Midea Group also ranked among the top three globally in these four areas, with market shares of 21.1%, 12.5%, 7.7%, and 4.6%, respectively, with Midea Group leading in home air conditioners and kitchen and other home appliances.

Based on 2023 production, Midea Group's home appliance compressor business ranks first in the global market with a market share of 30.3%. In terms of revenue in 2023, Midea Group is the largest in mainland China (with a market share of 14.3%) and among the top five globally (with a market share of 6.6%) for commercial air conditioning providers. KUKA Group, a subsidiary of Midea Group, is one of the world's four largest industrial robotics companies, ranking second in sales and revenue of heavy-duty robots in 2023, with market shares of 18.6% and 17.9%, respectively.

The prospectus also shows that for the years 2021, 2022, 2023, and the four months ended April 30, 2024, Midea Group's revenue was approximately RMB 343.361 billion, RMB 345.709 billion, RMB 373.710 billion, and RMB 145.780 billion, respectively, with annual/period profits of approximately RMB 29.031 billion, RMB 29.812 billion, RMB 33.747 billion, and RMB 13.646 billion, respectively.

Midea Group stated that looking to the future, it will continue to move forward around the four strategic axes of "technology leadership, direct user access, digital intelligence drive, and global breakthroughs." "Our goal is to continue to grow our commercial and industrial solutions business as an important engine for our growth, while remaining firmly committed to the continued expansion of our smart home business."