AgBank Shanghai IPO draws strategic investors: Source

Agricultural Bank of China's Shanghai initial public offering drew 30 billion yuan ($4.43 billion) in bids from potential strategic investors on its first day of bookbuilding, a source said, signalling healthy demand for what could become the world's biggest IPO.

Orders from institutions, including China Life Insurance Co, had already exceeded the value of shares reserved for them, said a source with direct knowledge of the situation, speaking on condition of anonymity as the process was still ongoing.

AgBank is in the process of raising more than $20 billion via a dual-listing in Shanghai and Hong Kong, which could end up becoming the world's largest-ever IPO.

The strong interest in Shanghai follows a similar showing in Hong Kong, where AgBank's offering was more than 10 times oversubscribed by institutional investors through Wednesday.

The upbeat data from the two markets means that AgBank, the last of China''s big four banks to go public, is on track to raise up to $23 billion yuan as China's third-biggest lender by assets seeks to replenish capital and drive growth.

If AgBank's offering is priced toward the top of its range, and a greenshoe option is exercised, the IPO will exceed the $21.9 billion raised by Industrial & Commercial Bank of China in 2006.

AgBank plans to sell up to 10.23 billion shares in its Shanghai offering at 2.52-2.68 yuan to strategic investors, or 40 percent of the Shanghai portion of the offering including the greenshoe overallotment.

Based on 2.68 yuan per share, the strategic placement could be worth up 27.4 billion yuan.