JL MAG Rare-Earth Completes Dual Listing

JL MAG Rare-Earth Co has completed its listing on the Main Board of the Hong Kong Stock Exchange (HKSE). Herbert Smith Freehills (HSF) advised JL MAG on the transaction, including the drafting of the prospectus.

The so-called ‘H’ shares began trading on the Hong Kong Stock Exchange on Jan. 14, raising HK$4.045 billion (US$520 million) and tied with the company's existing ‘A’ shares traded on the Shenzhen Stock Exchange.

Dual listing of shares on more than one exchange provides companies with certain advantages, such as greater liquidity and access to capital, and enables stock trading to continue in different time zones.

Founded in 2008 and headquartered in Ganzhou, southeast China, JL MAG specializes in the production of rare earth permanent magnets (REPM) for the automotive and energy industries, with a 14.5% share of the world REPM market.

In a statement, HSF Beijing partner Isaac Chen, who co-led the deal, said, "The firm is well-positioned in a booming industry during the global energy transition." Co-leading the HSF team with Chen was Beijing partner Wang Zhong, assisted by a team of senior associates and lawyers.

JL MAG Rare Earth Company Limited, listed on the Shenzhen Stock Exchange on September 21, 2018, is a professional high-tech enterprise integrating R&D, production, and sales of high-performance NdFeB permanent magnetic materials. It is a leading supplier of global new energy resources and environmentally friendly core application materials.

As a supplier of materials used in many high-tech goods, JL Mag has benefited from global trends towards devices that can save energy and reduce emissions. But it also faces risks associated with selling to just a small group of customers. The potential for trade restrictions or sanctions from the west, coupled with weak overall stock market sentiment in Hong Kong, has led the company to price its soon-to-be-listed new H-shares on the conservative side.

JL MAG Rare-Earth's products are widely used in new energy vehicles and auto parts, energy-saving inverter air conditioners, wind power generation, 3C, energy-saving elevators, robotics and intelligent manufacturing, rail transportation, etc. JL MAG has established long-term and solid relationships with leading domestic and foreign companies in these fields.

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