Ping An eyes $2bn listing of OneConnect fintech unit

OneConnect, a subsidiary of China’s largest insurance company that sells technology platforms to smaller banks, is preparing an initial public offering in Hong Kong that could launch this year, say two people familiar with the matter.

The timing of the deal for the Ping An company has not yet been determined, they said.

One banker involved in the offer estimated it could raise more than $2bn. Bloomberg reported the deal could happen as soon as September, and would involve Goldman Sachs, JPMorgan Chase and CCB International.

OneConnect raised $650m this year, valuing it at $7.4bn, Ping An said in its annual results for 2017. The company declined to comment on the IPO.

Ping An is a vast financial conglomerate with a background in insurance, banking and trust businesses. During the past five years it has launched dozens of start-ups focused on areas such as medical care, financial technology, online car sales and artificial intelligence.

As one of the conglomerate’s start-ups, OneConnect started as an internal unit that developed financial technology for the group. During the past four years, it has launched an outward-facing business that sells such technology to small banks, insurance companies and non-bank financial institutions around China.

Services include everything from credit checks and interbank transactions to product sales and mobile applications for retail banking services. OneConnect has sold its products to 468 banks and 1,890 non-bank financial institutions, and handled more than 900m credit inquiries last year, according to Ping An.

Ping An has joined other large Chinese technology and internet groups that have nurtured portfolios of start-ups and are now positioning the groups for fundraisings and IPOs.

Lufax, on online wealth management platform and the first sizeable anticipated spin-off from Ping An, has delayed its IPO due to regulatory concerns. Ping An Healthcare & Technology, which owns the health platform Good Doctor, filed for a $1bn IPO in February.

Chinese internet group Tencent has taken a similar approach to launching IPOs for companies it has developed, such as Tencent Literature, which raised more than $1bn late last year in a Hong Kong listing.

A handful of large Chinese tech IPOs are lined up for 2018 debuts after similar Chinese companies raised $7.6bn globally, according to data from Thomson Reuters.