Stocks News
- PetroChina eyes mainland riches
Date: 22-Jun-2007 Sources: (Xinhua Online)
BEIJING, June 21 -- Petrochina Co said yesterday it is planning a Shanghai share listing to raise as much as 6 billion U.S. dollars to fund expansion, joining other major state companies in a return to the mainland market.
Asia's largest oil and gas producer plans to sell up to four billion yuan-denominated A shares on the Shanghai Stock Exchange, it said on its Website.
Upon the announcement, PetroChina shares soared to HK$12.08 (1.55 U.S. dollars ) before closing 5.2 percent higher at HK$11.74. Based on the record-high close, the Shanghai sale could raise 6 billion U.S. dollars.
Yesterday's close also valued PetroChina at 269 billion U.S. dollars, surpassing Royal Dutch Shell Plc by market capitalization, and making it second only to ExxonMobil Corp, with 484 billion U.S. dollars, according to Bloomberg News.
'With high oil prices and its wide exposure to the lucrative upstream sector, PetroChina will definitely be pursued by mainland investors,' said Orient Securities analyst Wang Jing.
'A Shanghai IPO would allow mainlanders to invest in the most profitable listed firm in Asia for the first time.'
At present, Beijing-based PetroChina lists H shares in Hong Kong and American depositary receipts in New York. Each ADR, a United States-traded vehicle holding foreign-listed shares, represents 100 PetroChina H shares.
The proceeds from the Shanghai share sale will be used to explore domestic oil and gas resources, build refinery and pipeline projects and fund overseas acquisitions, PetroChina said.
The A-share issue will 'establish a new financing platform' and provide funds required for the ongoing business development for the company, PetroChina said.
An extraordinary general meeting will be held on August 10 for shareholders to vote on the Shanghai IPO, which is also subject to regulatory approval, PetroChina said, without giving further listing details, such as pricing.
The Chinese government is encouraging its flagship state-owned companies to get back for a domestic stock-market listing to soak up excessive liquidity.
It has been an easy sell. The overseas-listed firms are keen to raise funds by selling shares on the red-hot mainland markets.
Top cellular phone operator China Mobile, for example, plans to raise up to 10 billion U.S. dollars in Shanghai as early as next month, according to media reports early this week.
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