Packaging paper supplier Nine Dragons Paper Industries is due for a listing hearing this week as it bids to raise up to $3 billion in what is expected to be the biggest initial public offering so far this year.
If the company gets the go-ahead, it will start pre-marketing after the Lunar New Year.
Sources said it planned to offer one billion shares, 90 per cent reserved for institutional investors and the rest for retail investors. The company will offer an additional 150 million shares if there is strong demand.
The funds would be used for expansion, the sources said. The offer is being arranged by BNP Paribas Peregrine and Merrill Lynch.
After suffering losses due to internal restructuring, Nine Dragons recently turned a profit, earning $800 million in the latest financial year on turnover of $5 billion.
According to listing rules, a firm with a market capitalisation of more than $4 billion need not satisfy the track record requirement of having posted three consecutive years of profit. Sources said Nine Dragons' market capitalisation would be more than $10 billion.
