North Star to raise 3.6b yuan

Hong Kong-listed developer to sell 1.5b shares in Shanghai IPO after five-year wait on market

Beijing North Star, a Hong Kong-listed property developer owned by the Beijing city government, will raise 3.6 billion yuan by selling 1.5 billion shares at 2.40 yuan each - the top of its indicative price range - in a Shanghai initial public offering on Monday.

Shandong Demian, a state-owned textile manufacturer, said it will sell 70 million shares in Shenzhen for 3.24 yuan each on the same day.

The two sales come as shares of Shanxi Lu'an Environmental Energy Development, a coal producer controlled by the Shanxi provincial government, jumped 29.27 per cent to 14.22 yuan on their first day of trading yesterday, after raising 1.98 billion yuan in an IPO.

Analysts say the market has turned bullish on IPOs again after the easing of a government-imposed lull in large new share sales that lasted almost two months.

North Star, which first sold shares in Hong Kong in 1997, has been trying to sell shares domestically since 2001. Most recently, it was hampered by a year-long government ban on IPOs that ended four months ago. Its Hong Kong shares yesterday closed unchanged at HK$2.40.

Its latest IPO plan was approved primarily because it is the only property developer in the capital to bid for and win two contracts to build facilities for the 2008 Olympics - the Beijing International Convention Centre and the Olympic Media Village.