China household appliance manufacturer Midea is evaluating a possible HK listing

As part of its global strategy, Chinese home appliance manufacturer Midea Group announced on Wednesday that it is considering a possible listing in Hong Kong.

Midea, which is already listed on the Shenzhen stock exchange, stated in a filing that the new shares to be issued would not exceed 10% of the company's enlarged capital.

According to three sources with direct knowledge of the situation, Bank of America (NYSE:BAC) and China International Capital Corp (CICC) are working on a transaction.

Since the information is not yet public, the sources cannot be identified.

Bank of America and CICC both refused to comment.

In Thursday morning trading, Midea shares fell as much as 3.6% to 55.5 yuan ($7.70), reaching a two-month low.

Before the listing proposal was made public, Midea's market capitalization was $56.47 billion, making a deal of up to 10% one of the largest listings in Hong Kong since 2021.

According to one source, the corporation is seeking to sell between 8 and 10 percent of its stock.

According to the company's filing on Wednesday, specific plans, including a timeline, remain uncertain.

One source added that the initial filing with the Hong Kong Stock Exchange would be made this year, with a likely share sale in 2024.

According to the company's 2022 annual report, Midea ranked first in retail sales of home-use air conditioners in China and second in retail sales of laundry machines, citing data from data provider All View Cloud.

The company announced last month that it was planning to separate off its logistics unit Annto and list it on the Shenzhen stock exchange in an effort to consolidate the company's management structure and expand Annto's funding channels.