SHANGHAI (Reuters) - Six Chinese mutual funds will be launched as early as next Monday, potentially channeling hundreds of billions of yuan from investors into domestic floatations of overseas-listed Chinese tech giants, the Shanghai Securities News reported on Wednesday.
The six listed open-ended funds (LOF) aim to raise up to 50 billion yuan ($7.8 billion) each from investors with a lock-up period of three years. The funds would be used to participate in strategic placements of China Depositary Receipts (CDRs) to be issued by Chinese tech firms, the newspaper said.
China is encouraging overseas-listed Chinese companies to launch secondary listings in the domestic market through the issuance of CDRs. Domestic investors currently have limited access to some of China's most prominent tech giants.
Firms planning such issuance include Xiaomi, U.S.-listed Alibaba Group Holding Ltd and JD.com.
The six mutual funds will be distributed through the sales network of the country's biggest lenders including China Construction Bank, Bank of China, ICBC, and China Merchants Bank, the paper said.
The subscription period for retail investors will be from June 11 to June 15, while institutional investors can subscribe to the funds on June 19, it said.
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The funds will be launched by mutual fund houses including China Southern, China AMC, E Fund, Harvest, China Universal and China Merchants Fund.
($1 = 6.3932 Chinese yuan)
(Reporting by Samuel Shen and John Ruwitch; Editing by Jacqueline Wong)