CIC may buy $400 million Longyuan IPO shares

08:51, November 25, 2009      

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China Investment Corp. (CIC), the nation's sovereign wealth fund, may purchase $400 million worth of stocks of China Longyuan Power Group Corp. in its initial public offering (IPO) on the Hong Kong market, according to a Bloomberg report Tuesday citing three unnamed sources close to the offering.

One of the three sources also disclosed that CIC's holdings in Longyuan, China's largest wind-power producer will be locked up for 12 months.

"CIC's IPO participation would be considered as both an attractive investment for the sovereign fund and as an endorsement of one of the nation's high-growth industries," Wang Lei, a Santa Fe, New Mexico-based co-manager of the $16.7 billion Thornburg International Value Fund, said of the Longyuan investment.

He added that CIC's investment in energy companies like Longyuan reflect the company's increasing confidence in the renewable energy industry in China.

Longyuan, the world's fifth-largest wind-power producer by installed capacity, plans to sell 2.14 billion shares at prices ranging from HK$6.26 to HK$8.16, to raise a maximum of HK$17.5 billion.

The company plans to offer subscriptions from November 27 to December 2, setting the final issuing price on November 3, and start trading on the Hong Kong Stock Exchange from December 10.

Source: Global Times
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