Saturday, March 23, 2019
Martin Hennecke

Sinochem taps sponsors for oil unit's SAR listing
China's Sinochem Group has reportedly invited banks to pitch for roles in a proposed Hong Kong listing of its key oil assets, which could raise about US$2 billion (HK$15.6 billion).

The planned IPO for the state-owned group's energy unit will likely include its oil refining, oil trading, storage and logistics, as well as distribution and retail businesses.

The float comes amid a push by Beijing to inject new life into bloated state-owned enterprises by encouraging private capital investment in the enterprises.

Last October, the media reported that Sinochem had hired BOC International, CLSA and Morgan Stanley to work on a possible Hong Kong listing of its key oil assets.

The three banks are likely to be awarded senior roles on the IPO, likely to hit the market in the second half of the year.

Meanwhile, Spotify Technology plans to list shares on the New York Stock Exchange the week of April 2, giving the company weeks to prepare for an unconventional debut.

Spotify will deviate from decades of practice by not issuing any new shares or raising money in its initial public offering. Instead, existing stakeholders will offer their shares to investors, which is known as a direct listing.

An active market for private stock sales over the past few years has helped the company establish a valuation higher than US$20 billion, based on some of the transactions.

Spotify will spend the next few weeks meeting with investors to manage the uncertainty inherent in this approach, hoping to secure a smooth entry into the world's largest stock exchange.

It will host an investor day on March 15 to tout the prospects of a company that has helped transform the music business. Industry sales have grown three years in a row thanks to paid streaming services.

Spotify is the undisputed leader of the market. It had 71 million subscribers as of the end of 2017, about double its closest competitor, Apple Music.

Elsewhere, oil giant Saudi Aramco's IPO plan, which is expected to be the world's largest IPO, is reported to be delayed until next year.

In other IPO action, Chinese online jewelry retailer CSMall Group priced its IPO at HK$2.38 per share, close to the lower limit of the price range of between HK$2.28 to HK$3.28. It saw the retail tranche oversubscribed 4.6 times. It raised HK$410 million from the public offering.

Previous news : Profit jumps for China Literature


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