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SCMP Reporter

A  group of nine well-known investors  has put up   US$450 million for a 19 per cent stake in China Railway Construction Corp's US$2.35 billion H-share offering as cornerstone investors, sources said.
Among those nine are  tycoons Li Ka-shing and Cheng Yu-tung, Singapore's Temasek Holdings and the Government of Singapore Investment Corp, as well as Yale University.
Other investors include Hong Kong-listed Citic Pacific and Shau-kee Financial, the private investment arm owned by billionaire Lee Shau-kee.
Two mainland financial institutions -  Bank of China Investment and  China Life Group are also key investors in  China Railway Construction's initial public offering, the sources added.
Yale University, which is fairly new  to the Hong Kong  market, first appeared  as a cornerstone investor in Walker Group's HK$579 million initial offering last year.
The renowned university invests through various funds in   domestic equity, fixed income, foreign equity, private equity, real assets and cash.
China Railway Construction may raise a total of US$5.2 billion in first-time stock sales in Shanghai and Hong Kong.
The Beijing-based company aims to sell as many as 2.45 billion yuan-denominated shares in Shanghai at eight yuan to 9.08 yuan each for as much as 22.25 billion yuan. It will offer about 1.71 billion shares in Hong Kong at HK$9.93 to HK$10.70 each for as much as HK$18.25 billion.
Cornerstones investors will  get a guaranteed allocation but must agree to not sell the shares  for anywhere between six months and three  years.
China Railway Construction, the mainland's second-largest infrastructure contractor, is expected to  raise 25 per cent more for its dual listing in Shanghai and Hong Kong to reach the maximum of US$5 billion, compared to the original target of US$4 billion.
However, the listing candidate has cut its portion of  the domestic offering by 12.5 per cent to US$2.45 billion while the price range remains unchanged at eight yuan to 9.08 yuan per share, to raise up to US$2.8 billion from its first share sale, a market source said.
'The adjustment of the number of A shares is due to the higher valuation the company priced in the offering,' the source said.
The Shanghai Composite Index has dropped 5 per cent since the re-opening of the mainland stock market following the Lunar New Year.
The H-share offering for institutional investors is scheduled to  start today in Hong Kong before moving to Singapore tomorrow while the public offering will take place from  March 3 to March 6.
Trading of the company's shares is expected to begin on March 13.
Citi and Macquarie are responsible for the H-share offering while Citic Securities is handling  both the A and H-share sales.
Meanwhile, the international offering of oil rig maker Honghua Group has been covered five times   due to a more stable market environment and stronger demand for oil resources, sources said.
The mainland  firm is selling 833 million new shares at an offer price range of HK$3.16 to HK$4.50 per share, allowing it to raise HK$3.7 billion  to fund expansion, according to the prospectus.
Credit Suisse and Morgan Stanley are the arrangers of the share sale.



Key investors take 19pc of H shares  in China Railway Construction IPO