China Shenhua Group starts three-day IPO price bidding
(Xinhua)
Updated: 2007-09-19 16:02
Updated: 2007-09-19 16:02
China Shenhua Group, the country's largest coal producer, began Wednesday to accept bids that will determine the price of shares in its initial public offering (IPO).
The bidding opens to institutional investors and will last through Friday, the China Securities Journal reported Wednesday.
The coal producer would sell up to 630 million shares, 35 percent of the IPO, to institutional investors and the remainder to individual investors.
On Monday, the China Securities Regulatory Commission gave go-ahead to China Shenhua's IPO plan to issue up to 1.8 billion A shares.
If its A-share price was the same as its H-share price, which closed at HK$39.5 on Tuesday, the IPO could raise 69 billion yuan (US$9.2 billion), said analysts.
This would then make it the largest A-share listing ever, exceeding the 58.05 billion yuan of the China Construction Bank, the country's second largest commercial bank.
The government is encouraging China's red-chip companies to launch yuan-denominated A-share IPOs amid efforts to absorb excess liquidity and help cool the heated stock market that has more than doubled since the beginning of the year.
The company said it would use the proceeds to build or upgrade its coal, power and transportation systems and purchase strategic assets.
By the end of this June, it had proven reserves of 5.99 billion metric tons mainly in northern China's Shanxi province and Inner Mongolia Autonomous Region.
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