Gateway Energy & Resource Holdings, an investment fund managed by the Asian arm of United States private equity firm EIG Global Energy Partners, is aiming to raise up to US$200 million via a Hong Kong listing.
Set up in 2007 by EIG, which manages US$9.2 billion of assets under various funds, Gateway is listed on GSTrUE - a private exchange for institutional investors managed by Goldman Sachs. Through the Hong Kong share offer, Gateway would roughly double its net asset value, which stood at US$187 million on September 30.
Gateway is offering 13 million new shares at HK$117 to HK$120 each, representing a 4 to 6.4 per cent discount to its net asset value of HK$125 at the end of last year, said a person with direct knowledge of the deal, which is arranged by Citi, Morgan Stanley and BOC International. The shares are due to be priced today.
Under local listing regulations, as an investment company Gateway's shares may be sold only to professional investors, but retail investors will be able to trade in the shares via the exchange after its expected listing debut on March 30, subject to the condition that the minimum size of each trade is HK$500,000.
Gateway's funds are invested in five managed funds and four direct investments, which in turn have investments in 70 firms and projects in more than 20 nations. The funds are either invested in EIG-managed funds or co-invested with EIG in other energy and resources projects.
Gateway's listing allows investors not big enough to qualify to invest in EIG to get exposure to its investments, which include unconventional energy projects such as the exploration and production of oil and gas trapped under deep-sea floors in Brazil, and within onshore sedimentary rock formations in the US.
Exploitation of such hard-to-extract energy resources has become economical in recent years due to rising oil prices and new technology.