SINGAPORE: Petronas Chemicals is looking to raise as much as $4 billion in a Malaysian initial public offering, exceeding earlier estimates of over $2 billion as it hopes to tap on strong global investor demand for Asian stocks, according to a Reuters report on Tuesday, Oct 12.
Asian capital markets are seeing a flurry of multi-billion deals, helped by a flood of liquidity, low interest rates and strong economic growth.
The IPO for Petronas Chemicals, owned by Malaysian state oil giant Petronas, could become the largest share offering in the country, exceeding Maxis's $3.3 billion listing last year.
It follows Singapore wealth fund GIC's logistic unit's $3 billion IPO and may overlap with American International Group's planned listing of its Asian life insurance business AIA in a deal worth over $15 billion.
"This is a big surprise and it comes at a time when there is heated interest for oil and gas stocks," said Danny Wong, chief executive of Acera Capital, which manages about 400 million Malaysia ringgit ($129 million) in funds.
"Even though foreign investors are not very big on Malaysia, this IPO could spark more interest and even then I forsee 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 begin "pre-marketing" its IPO on Tuesday with formal investor roadshows slated to begin on Oct 27.
The deal is expected to be priced on Nov 12, according to an email sent to investors by one of the advisers.
Petronas Chemicals has an annual production capacity of more than 10 million tonnes. It posted an operating profit of $2.3 billion in fiscal 2009, according to its prospectus.
Oil firm Petronas, which is a lifeline for the Malaysian economy as it provides almost half of the country's budget revenue through taxes and dividends, also controls industrial gas supplier Petronas Gas and petrol station operator Petronas Dagangan
Petronas Chemical Group's 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 initial public offering of its petrochemicals business last month.
Tuesday's email said 31 percent of the company wil be floated of which 11.5 percent will be offered to ethnic Malay investors known as Bumiputera investors, 15.5 percent to foreign and domestic institutions, 2 percent each to retail investors and Petronas employees.
The company is raising funds for expansion of business, working capital and corporate needs. - Reuters
Asian capital markets are seeing a flurry of multi-billion deals, helped by a flood of liquidity, low interest rates and strong economic growth.
The IPO for Petronas Chemicals, owned by Malaysian state oil giant Petronas, could become the largest share offering in the country, exceeding Maxis's $3.3 billion listing last year.
It follows Singapore wealth fund GIC's logistic unit's $3 billion IPO and may overlap with American International Group's planned listing of its Asian life insurance business AIA in a deal worth over $15 billion.
"This is a big surprise and it comes at a time when there is heated interest for oil and gas stocks," said Danny Wong, chief executive of Acera Capital, which manages about 400 million Malaysia ringgit ($129 million) in funds.
"Even though foreign investors are not very big on Malaysia, this IPO could spark more interest and even then I forsee 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 begin "pre-marketing" its IPO on Tuesday with formal investor roadshows slated to begin on Oct 27.
The deal is expected to be priced on Nov 12, according to an email sent to investors by one of the advisers.
Petronas Chemicals has an annual production capacity of more than 10 million tonnes. It posted an operating profit of $2.3 billion in fiscal 2009, according to its prospectus.
Oil firm Petronas, which is a lifeline for the Malaysian economy as it provides almost half of the country's budget revenue through taxes and dividends, also controls industrial gas supplier Petronas Gas and petrol station operator Petronas Dagangan
Petronas Chemical Group's 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 initial public offering of its petrochemicals business last month.
Tuesday's email said 31 percent of the company wil be floated of which 11.5 percent will be offered to ethnic Malay investors known as Bumiputera investors, 15.5 percent to foreign and domestic institutions, 2 percent each to retail investors and Petronas employees.
The company is raising funds for expansion of business, working capital and corporate needs. - Reuters
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