CNOOC Secures US$460m Ahead of FloatsChina National Offshore Oil Corp (CNOOC) has secured US$460 million from eight strategic investors which have bought a combined 8.5 per cent stake in the company.CNOOC, the listing vehicle of China's third-largest oil firm, secured the investments ahead of its planned flotation in Hong Kong and New York next year. Quoting CNOOC's preliminary listing prospectus, Reuters said Thursday the company was planning to issue 1.44 billion new shares and that CNOOC's state-owned parent would sell 200 million existing shares. Based on the price of US$0.825 per share paid by the eight investors earlier this year, CNOOC could raise as much as US$1.19 billion and its parent could receive US$165 million from the offering. CNOOC is the largest producer of offshore oil and gas. It has interests in 42 oil and gas properties. In the middle of last year, half the properties were operational and the other half were still being developed. Analysts expect the company will make its listing debuts in February next year. The company had hoped to raise as much as US$2.5 billion. It aborted its US$1 billion global initial public offering (IPO) in October last year, with former lead manager Salomon Smith Barney citing adverse market conditions. The shares were marketed at a prospective weighted average price-to-earnings multiple range of 18.97 to 21.55 times, which investors considered expensive. China's largest oil producer, PetroChina, and China's largest oil refiner, Sinopec, sold their shares at corresponding multiples of 10.6 times and 6.6 times last April and October, respectively. Joint global co-ordinators Merrill Lynch, Credit Suisse First Boston and BOC International would not confirm the figures, citing confidentiality. According to the document, CNOOC plans to spend about US$4 billion on capital expenditures relating to the development of its oil and gas properties in the next three years. It would also spend about US$190 million annually on independent exploration. Some US$200 million would be used for paying benefits to about 7,000 CNOOC employees who retired under a corporate reorganization in October 1999. Daiwa SB International Capital chief investment officer Ambrose Chang Chung-kwong said that although it was not uncommon among mainland enterprises, disposal of listing proceeds to pay for past redundancy costs would dampen investment interest. Last month, global oil giant Royal Dutch Shell agreed to pay for US$300 million of shares in the planned IPO, while BP Amoco was in talks to buy US$200 million of shares. According to the document, financial firm American International Group has purchased a 2.95 per cent stake. Hutchison Whampoa and associate Hong Kong Electric Holdings have taken a combined stake of 1.84 per cent. |
| People's Daily Online --- http://english.peopledaily.com.cn/ |