(Yicai Global) Jan. 29 -- Chinese financial software firm Hundsun Technologies will partner with a US market intelligence firm under London-headquartered IHS Markit to provide digital bond pricing and distribution services to Chinese bond issuers.  

Hundsun signed a memorandum of cooperation with Ipreo Holdings in New York on Jan. 25 to form a joint venture in China to explore electronic bookbuilding solutions in the bond market on China's mainland, the Hangzhou-based party said in a statement yesterday. The JV will set up a subsidiary in Hong Kong to commercialize Ipreo's products in China.

China has the world's third-largest bond market, where over CNY43 trillion (USD6.4 trillion) worth of such debt instruments was issued last year. Foreign capital inflows amounted to around USD100 billion.

Hundsun will develop on its own an underwriting network which fits the Chinese bond market while using Ipreo's advanced technologies and rich experience on electronic bookbuilding, the statement added. The move will help Chinese investment banks and institutional investors get access to the global underwriting network. It will also promote more overseas investment in China. 

"Cooperating with Ipreo will help the firm expand in the primary markets and overcome difficulties such as information asymmetry in bond issuing in China and thus improve efficiency," said Peng Zhenggang, the chairman of Hundsun.

"There is a significant opportunity to introduce electronic bookbuilding solutions to the bond market in China," New York-headquartered Ipreo's President Kevin Marcus said. "Working with a leader like Hundsun brings the expertise and network needed to be successful in providing new solutions to the domestic fixed income markets to benefit issuers, investors and banks."

Global information provider IHS Markit spent USD1.9 billion to buy Ipreo from private equity funds managed by Blackstone Group and Goldman Sachs Merchant Banking Division last August.

Editor: Emmi Laine