ASEAN KEY DESTINATIONS
Petronas IPO could raise US$4 billion
Asian capital markets are seeing a flurry of multi-billion-dollar deals, helped by a flood of liquidity, low interest rates and strong economic growth.
The IPO for Petronas Chemicals, owned by oil giant Petroliam Nasional Bhd (Petronas), could become the largest share offering in the country, exceeding Maxis' US$3.3 billion (RM10 billion) listing last year.
It follows Singapore wealth fund GIC's logistic unit's US$3 billion (RM9 billion) IPO and may overlap with American International Group's planned listing of its Asian life insurance business AIA in a deal worth over US$15 billion (RM47 billion).
"This is a big surprise and it comes at a time when there is heated interest in oil and gas stocks," said Danny Wong, chief executive officer of Acera Capital, which manages about RM400 million (US$124 million) in funds.
"Even though foreign investors are not very big on Malaysia, this IPO could spark more interest and even then I foresee a lot of local institutional players going for this latest proxy of Petronas."
Petronas Chemicals, which manufactures olefins and polyolefins, fertilisers, industrial and specialty chemicals, will have started "pre-marketing" its IPO yesterday with formal investor roadshows slated to begin on October 27.
The deal is expected to be priced on November 12, according to an e-mail sent to investors by one of the advisers.
Petronas Chemicals has an annual production capacity of more than 10 million tonnes. It posted operating profit of US$2.3 billion (RM7 billion) in fiscal 2009, according to its prospectus.
Petronas also controls industrial gas supplier Petronas Gas and petrol station operator Petronas Dagangan.
Petronas Chemicals' IPO is one of two offerings to be launched by government-run Petronas in response to Prime Minister Datuk Seri Najib Razak's call to reduce state ownership in the private sector and boost liquidity in the stock market.
CIMB, Deutsche and Morgan Stanley are joint global coordinators and bookrunners, while Citigroup and UBS are co-bookrunners.
Petronas filed a draft prospectus for an IPO of its petrochemical business last month.
Yesterday's e-mail said 31 per cent of the company will be floated, out of which 11.5 per cent will be offered to Bumiputera investors, 15.5 per cent to foreign and domestic institutions, 2 per cent each to retail investors and Petronas employees.
The company is raising funds for expansion of business, working capital and corporate needs.
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