China Oilfield Services' (COSL) initial public offering has been a success despite a difficult climate for mainland share issues. The international tranche of the IPO was about 10 times oversubscribed, while the Hong Kong public offering was more than 15 times oversubscribed, sources close to the deal said. The strong response to the main-board candidate's shares is in sharp contrast to China Telecom's IPO. The giant fixed-line operator recorded a 1.25-times subscription rate for its international tranche and 3.7 times for its public offer, after slashing its offer size by 55 per cent. COSL - the largest oilfield services provider in offshore China - has priced its shares at HK$1.68 a piece, near the high end of the indicative range of HK$1.40 to HK$1.70. At HK$1.68, the company will raise HK$2.03 billion through the sale of 1.21 billion new shares to part fund its HK$4.42 billion capital expenditure plan up to 2005. Its parent, China National Offshore Oil Corp, will raise HK$203.83 million by selling 121.33 million existing shares. A source at one of the banks involved in the deal said COSL had decided to 'leave something on the table', for its listing debut next Wednesday. The strong demand for its Hong Kong IPO triggered the clawback mechanism of the deal. This means the company will allocate some of the shares in the international tranche to the Hong Kong offer, so that the latter will account for 30 per cent of the total. Under the original offer terms, only 133.46 million H shares - 10 per cent of the total shares on sale - were offered to local investors. The clawback mechanism - triggered when demand for the Hong Kong offer reached at least 15 times the number of shares available - will increase that to 400.39 million shares. Fund managers and analysts attributed the success of COSL's offer partly to the good financial performance of sister company CNOOC. The shares of China's dominant offshore oil producer rose 17.6 per cent on their debut in March last year and yesterday ended 68.9 per cent higher than the IPO price. COSL sourced 52 per cent of its first-half revenue from providing services to CNOOC. The good response to COSL's offer came two days after fellow main-board candidate Hainan Meilan Airport - the mainland's eighth-busiest passenger airport - saw the international portion of its up to HK$764.44 million IPO 10 times oversubscribed. Retail investors in Hong Kong sought about five times more shares than had been offered. However, both COSL and Haikou Meilan offered their shares at a price lower than that which was originally indicated to fund managers, amid news of the poor response to China Telecom's offer. COSL originally wanted to sell its shares at up to HK$2.20, while Haikou Meilan was aiming at up to HK$4.20.