Stocks News
- Shenhua Energy starts Shanghai A-share IPO
Date: 20-Sep-2007 Sources: (Shenzhen Daily)
CHINA Shenhua Energy, the country's top coal producer, launched its Shanghai initial public offering (IPO) of shares yesterday, which could raise nearly US$10 billion, the mainland's largest share sale yet.
Book-building was kicked off yesterday, a price range will be announced next Monday and retail subscriptions will be taken Tuesday, Hong Kong-listed Shenhua said in a statement published in the Shanghai Securities News.
Funds from unsuccessful bids will be returned to investors next Thursday and Friday.
Shenhua plans to issue up to 1.8 billion local-currency A shares, or 9 percent of its expanded share capital, for a listing on the Shanghai Stock Exchange, to raise funds mainly for upgrading technology and acquiring assets.
Based on the price of its Hong Kong-listed shares, which closed at HK$39.5 (US$5.08) Tuesday, the planned offer in Shanghai could raise as much as 74 billion yuan (US$9.8 billion), although mainland firms typically sell shares to domestic investors at a discount to their Hong Kong share price.
Shenhua said in yesterday's statement it planned to sell 630 million shares, or 35 percent of the Shanghai offer, to institutional investors and the rest to retail investors.
Shenhua's offer is part of a string of big IPOs the authorities are encouraging, partly in the hope of cooling the stock market with additional supplies of equity.
The value of Shenhua's IPO is set to exceed that of China Construction Bank, which raised 58 billion yuan this week in the country's largest domestic IPO to date.
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