Beijing Capital Airport intends to raise between US$400 million and $500 million from an overseas listing that could take place as early as the first quarter of next year, according to investment banking sources. The sponsor of the issue, ABN Amro, has started to contact merchant bankers who might be interested in joining the underwriting syndicate. The sources said it was unlikely the listing candidate would be ready to tap the market as early as this year. Beijing Capital Airport plans for listing had not been affected by the failed attempt last month for a dual float in the United States and Hong Kong by mainland oil giant (CNOOC), a company official said. Nor would its plans be speeded up by the more encouraging response to the share placement and bond issue last week of red chip China Telecom (Hong Kong). CNOOC decided to postpone its $2.5 billion listing last month due to lacklustre investor response and subsequent regulatory hurdles for downsizing the issue and cutting the issue price. Despite the unfavourable sentiment towards CNOOC and other mainland issues, China Telecom received a satisfactory reception for its $2.15 billion share placement and bond issue. Analysts said the Beijing Capital issue might not look attractive based on price earnings, because depreciation arising from an expansion project might wipe out a large portion of the company's earnings. They also expressed concern over the company's heavy debt burden, partly built up by the expansion project. Under the recent nine billion yuan (about HK$8.4 billion) expansion project, the airport's passenger handling capacity has doubled to about 35 million passengers a year, according to some reports. Like many conventional airports, Beijing Capital relies heavily on landing and parking fees as a source of revenue, with limited earnings from retailing and catering. On the bright side, there is potential for growth from the expansion of retailing and catering business, analysts said. NEW LISTINGS
