STOCKS | Pateo Connects Falls 10.3% After HK$588 Million Share Placement

Pateo Connects (02889) fell 10.3% to HK$126, extending its decline to two days and bringing the cumulative drop to 13.3%, according to ETNet. The stock traded about 20,000 shares, worth HK$3.07 million. The company said it has signed a placement agreement to sell up to about 4.89 million new shares to no fewer than six placees at HK$120.28 each, a 14.39% discount to the previous close of HK$140.5. The placement is expected to raise net proceeds of about HK$588 million. After completion, the new shares will account for about 2.93% of the enlarged issued share capital, while public float in the H shares is expected to fall from 41.57% to 40.35%. Pateo Connects said about 40% of the proceeds will be used for strategic mergers and acquisitions and investments, including optical communications, semiconductors and AI agents, while 60% will go to general corporate purposes such as working capital, share buybacks and bank debt repayment.