Southeast Electric to raise US$215m

PUBLISHED : Tuesday, 09 September, 1997, 12:00am
UPDATED : Tuesday, 09 September, 1997, 12:00am

Zhejiang Southeast Electric Power, soon to be the first mainland B share to list in Shanghai and London, has priced its shares at between 29.1 US cents and 35.9 cents each, with the aim of raising up to $215.4 million.

The issue's international co-ordinator, BZW Asia, said the price represented a multiple of between 9.5 and 11.5 times this year's prospective earnings of 450 million yuan (about HK$418.14 million).

The price will be fixed on Friday when the international roadshow ends.

The company's B shares in Shanghai and global depository receipts (GDRs) in London will begin trading on September 23. One GDR represents 50 B shares.

The Hangzhou-based firm intended to issue equal quantities of GDRs and B shares, BZW said. Hong Kong investors tended to prefer B shares and European investors GDRs.

Zhejiang Southeast will issue 600 million shares, or 31.3 per cent of its enlarged share capital.

The company owns eight units of Taizhou Power Plant and will spend 900 million yuan of the issue proceeds to buy the Xiaoshan power plant, which has an installed capacity of 250 MW.

While profits of the previous overseas-listed power firms are generally based on a return at net fixed asset, Zhejiang Southeast will tie the equity-financed return at 15 per cent to net assets.

This is intended to cover working capital and net fixed assets, which includes construction in progress.