Railway contractor pursues H-share float
Mainland developer Evergrande to meet with investment banks before deciding on IPO
Some listing candidates are betting that the Year of the Rat will bring better luck with fund-raising activities.
China Railway Construction Corp, the mainland's top road and rail contractor, will go ahead with pre-marketing for its proposed US$1.6 billion H-share offering while Guangzhou-based developer Evergrande Real Estate Group will decide by Monday whether to launch its US$1.5 billion sale, according to market sources.
China Railway Construction would hold talks today with fund managers in a meeting arranged by Citi, one of the sponsors of the jumbo offering, while Citic Securities, another sponsor, would meet institutional investors on Thursday, the sources said. Macquarie Group is also an arranger of the listing.
The H-share offering is to take place on February 22, three days after the rail contractor markets its A shares next Tuesday to raise as much as US$2.4 billion on the Shanghai exchange. The trading debut of the H shares is scheduled for March 18.
The Hang Seng Index has shed 18.68 per cent in just a little over a month this year.
So far this year, eight companies have called off their listing plans in the face of weakening investor sentiment and a tumbling stock market. Unwilling to take sponsors' suggestion to price themselves 'on the cheap', they opted to delay or shelve their offerings.
Mainland developer Evergrande, which has attracted about US$700 million from cornerstone investors, would meet either on Friday or Monday with investment banks to decide whether to press on with the sale, market sources said.
Credit Suisse, Goldman Sachs and Merrill Lynch are arranging the US$1.5 billion deal.
Substantial investors include Merrill Lynch, Deutsche Bank and Temasek Holdings, the investment arm of the Singapore government.
The company has a land bank of 39 million square feet.
Last month, it paid a larger than expected sum of 4.1 billion yuan for a residential site in Guangzhou.
In December, the company formed a partnership with mainland online property broker E-House Holdings (China) to arrange the sale of 20 real-estate projects that could fetch as much as 200 billion yuan.
A third listing candidate, Want Want Holdings, a manufacturer of rice crackers and sweets, started pre-marketing yesterday for its HK$9 billion offering slated for the middle of next month, one market source said.
'The bookbuilding will come to the market after receiving a response from institutional investors over the next two weeks,' the source said.
UBS and BNP Paribas are jointly leading the transaction.
After shelving its listing last month, Honghua Group plans to give it another try next week.
Credit Suisse and Morgan Stanley are jointly arranging the deal.
Among those pulling out are China Pacific Insurance, which is seeking US$3 billion, and casino operator Sociedade de Jogos de Macau, which plans to raise US$1 billion.
Other firms include Maoye International Holdings, a Shenzhen retail chain operator seeking HK$7 billion; Solargiga Energy Holdings, a solar equipment maker targeting HK$2 billion; Changsheng China Property, a Guangzhou developer aiming for HK$1.1 billion; and SFK Construction Holdings, which seeks HK$1.2 billion.