Stocks News
- Regulator approves Chalco's Shanghai offer
Date: 19-Apr-2007 Sources: (Shenzhen Daily)
THE stock regulator has approved an application by Aluminum Corp. of China (Chalco) for a share offer in Shanghai to buy out two units in a deal worth more than US$1 billion.
Chalco, the world's fourth-biggest producer of aluminum, will issue 1.237 billion Shanghai A shares at a price of 6.60 yuan each, valuing the deal at 8.16 billion yuan (US$1.06 billion), although no proceeds will be raised in the buyout deal.
The shares will be exchanged for shares in two Shanghai-listed Chalco units: smelter Lanzhou Aluminum Co. and alumina maker Shandong Aluminium Industry Co., which will both be delisted.
The shares would be exchanged at a rate of one Lanzhou share for 1.8 Chalco shares and one Shandong share for 3.15 Chalco shares. Lanzhou last traded in Shanghai at 14.61 yuan, while Shandong was at 25.41 yuan.
Chalco forecast its net profit would fall 8 percent to 10.8 billion yuan in 2007 from 11.7 billion yuan in 2006, according to a preliminary prospectus posted on the China Securities Regulatory Commission's Web site.
The firm said price increases for raw materials for production would hurt its profits.
Chalco the world's largest aluminium company, will be the latest in a series of domestic listings by China's industrial leaders.
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