Energy

Goldwind in $1.2b HK IPO: sources

(Agencies)
Updated: 2010-05-31 14:46

Goldwind, which is already listed on the mainland's Shenzhen stock exchange, would offer 395.29 million shares, or 15 percent of its enlarged share capital, with an indicative price range of between HK$19.80 ($2.54) and HK$23, the sources said today. There was a greenshoe option to increase the issue by up to 59 million shares, they said.

The sources have direct knowledge of the offering but were not authorized to speak on the record about the deal.

Hong Kong's Hang Seng Index has lost more than 6 percent since the start of May in volatile trading, with investors cautious because of the European debt crisis.

Earlier this month, Russia's Strikeforce Mining & Resources, China Tian Yuan Mining Ltd and Swire Pacific's property arm shelved their IPO plans in Hong Kong as global debt worries dented investor appetites for corporate fundraising.

The H-share offering price range valued Goldwind at 18.8 to 21.8 times prospective 2010 earnings forecast by sponsors, said one of the sources close to the deal.

By comparison, Dongfang Electric trades at 19 times forecast 2010 earnings, while China High Speed Transmission trades at 15.6 times.

Goldwind's shares ended on May 28 in Shenzhen at 22.83 yuan ($3.34), down 1.4 percent. Its shares have gained 27 percent this year, outperforming the Shanghai Composite Index's 19 percent drop.

Chinese International Capital Corp (CICC), Citigroup, and Credit Suisse are underwriting Goldwind's deal.

CICC forecast Goldwind's net profit this year to jump to 2.4 billion yuan ($351.4 million), a 36.7 percent increase from 2009, and predicted a further 26 percent jump to 3 billion yuan in 2011.

Related readings:  Goldwind gets $6b credit line to fuel its int'l drive  Goldwind gets nod for HK IPO  Goldwind says China regulator approves HK listing  Goldwind to spread wings overseas for growth

Goldwind, which kicked off its IPO road show today, plans to price the deal on June 11 in the United States, with trading scheduled to begin on June 22.

China has said it aims to boost total wind-generated power to 100 gigawatts by 2020 with investments possibly worth more than $150 billion, which would likely make it the world leader in wind energy. The country became the world's largest wind turbine market in 2009 in terms of new installations totaling 12 gigawatts, up 92 percent year-on-year. The Chinese turbine market has grown in terms of global market share from only 1 percent in 2001 to 36 percent in 2009.

Renewable energy accounts for a fraction of a percent of China's total electricity output. Coal-dependent China has said it hopes to lift the level to 10 percent by 2010 and 15 percent by 2020.