Montage Technology plans up to $1 billion Hong Kong share sale in January, sources say

Company aims start trading before end-January, sources say Montage may raise up to $1 billion, sources say Proceed earmarked for R&D and expansion By Yantoultra Ngui and Kane Wu HONG KONG, Jan 8 (Reuters) - Chinese semiconductor designer Montage Technology (688008.SS) plans a second listing in Hong Kong via a $800 million to $1 billion share offering as soon as this month, said two people with knowledge of the matter, adding to the hectic pace of fundraising in the city. If the company meets the $1 billion target, the deal would be the largest in Hong Kong since China’s Zijin Gold International’s (2259.HK) $3.53 billion listing in September, LSEG data showed. The timetable isn’t finalised but the listing will likely take place on January 26, said one of the people, who have declined to be named as the information is not public. Montage Technology, which cleared its Hong Kong stock exchange hearing on Monday, did not immediately respond to a request for comment. Artificial Intelligence and chip IPOs have surged in recent weeks in both Hong Kong and mainland China, as Beijing pushes to strengthen its domestic capabilities and reduce reliance on U.S. technology. Huawei’s AI server spin-off xFusion has hired Citic Securities in preparation for a mainland IPO, while memory chipmaker ChangXin Memory Technologies and Baidu’s AI chip arm Kunlunxin are planning listings too, Reuters has reported. On Thursday, three Chinese technology firms made strong Hong Kong debuts after raising a combined $1.19 billion. They included AI company Zhipu AI, or Knowledge Atlas Technology, (2513.HK) that OpenAI flagged as a fast-rising rival. Founded in 2004, Montage Technology designs fabless integrated circuits, which are used to speed data flow between chips in servers and data centres. It raised $71 million in a Nasdaq IPO in September 2013 but was taken private a year later by state-owned Shanghai Pudong Science and Technology Investment Co. It relisted on Shanghai’s STAR Market in 2019 and now boasts a market cap of about $22 billion. Its shares have almost doubled in value over the last year, LSEG data shows. Citing consulting firm Frost & Sullivan, a draft prospectus filed with the Hong Kong exchange showed Montage held a 36.8% share of the global memory interconnect chip market in 2024. Revenue increased 59% from 2023 to 2024, to 3.64 billion yuan ($521.27 million), with a net profit of 1.34 billion yuan and a gross margin above 58%, according to the prospectus. The company plans to use proceeds from the listing to boost research and development in interconnect chips, invest in marketing and pursue strategic investments. ($1 = 6.9829 Chinese yuan renminbi)