China's Xiaomi raises $3.9 bln but shares fall

The stock of Chinese smartphone maker Xiaomi has risen over 147% this year.

But on Wednesday (Dec 2) its shares fell 7.1% in Hong Kong as the company finalised a $3.91 billion capital raising that included the city's largest top up placement.

The company said 1 billion shares were sold as part of the deal that was carried out overnight.

The final price was a 9.4% discount to Xiaomi's closing price on Tuesday.

Trading of Xiaomi's stock was halted during Wednesday morning's session before the company released details of the deal.

Xiaomi did not immediately respond to a Reuters request for comment on why the deal was not announced until lunchtime.

When the stock resumed trading it fell by nearly 12% before paring losses to close down over 7 percent.

Xiaomi recently reported a 19% jump in third-quarter net profit.

as its shipments surged by 45% from a year earlier.

The smartphone maker said it's taken market share in China and Europe as its rival Huawei Technologies faced U.S. sanctions that have hit its supply chain.

Video Transcript

- The stock of Chinese smartphone maker Xiaomi has risen over 147% this year. But on Wednesday, its shares fell 7.1% in Hong Kong as the company finalized a $3.9 billion capital raising that included the city's largest top up placement. The company said a billion shares were sold as part of the deal that was carried out overnight.

The final price was a 9.4% discount to Xiaomi's closing price on Tuesday. Trading of Xiaomi's stock was halted during Wednesday morning session before the company released details of the deal. Xiaomi did not immediately respond to a Reuters request for comment on why the deal was not announced until lunchtime.

When the stock resumed trading, it fell by nearly 12% before paring losses to close down over 7%. Xiaomi recently reported a 19% jump in third-quarter net profit as its shipments surged by 45% from a year earlier. The smartphone maker said it's taken market share China and Europe as its rival, Huawei Technologies, faced US sanctions that have hit its supply chain.