Singamas nets $349m in quick placement
Singamas Container Holdings, the world's second-largest container maker, was swift to snap up HK$349 million to fund its China expansion amid a rebound in the stock market yesterday.
Soon after seeing its shares edge up 2.5 per cent to HK$4.05 in morning trade, the main board-listed company had its shares suspended from trading and hired Dutch firm ABN Amro to conduct a top-up share placement.
Singamas initially intended to sell 60.18 million shares at an indicative price range of HK$3.81 to $3.93 to raise between $229.28 million and $236.5 million.
The deal was quickly covered within the first half hour after launching and eventually attracted demand of more than 3.5 times the shares, according to market sources.
Singamas then sold an extra 28.62 million shares to bring the total to 88.8 million to meet the strong demand from fund managers.
The shares represented 17 per cent of Singamas' existing issued share capital and 14.53 per cent of the company's enlarged share capital.
ABN Amro fixed the placement price at HK$3.93 - at the top end of the indicative price range - which is a mere 3 per cent discount to its last traded price of $4.05.
It is the second time Singamas has hired the Dutch bank to help it to raise fresh capital over the past 16 months.
Singamas, which makes containers and related parts, operates container depots, and container storage services, will use the net proceeds of HK$338.5 million to fund its expansion plan.
The company plans to double the production capacity in its container building plants in Tianjin and Guangdong provinces.
About HK$124.8 million will be used to relocate and expand its dry freight and specialised container factory in Tianjin to double the factory's annual capacity to 100,000 teu (20-foot equivalent units), while about $195 million will be used to build a dry freight and specialised container factory in Guangdong to add another 200,000 teu in annual capacity.
In August, Singamas said its half-year profit surged 49 per cent to US$10.5 million while projected growth in the second half remained robust due to strong demand for shipping services as a result of surging mainland trade and the global economic rebound.