China Sinohydro confirms to launch $2.7 billion IPO this week

Sept 19, 2011

(Reuters) - Sinohydro Group Ltd, the builder of the Three Gorges Dam, said on Monday it would launch a $2.7 billion initial public offering this week, confirming a Reuters report last week.

Sinohydro plans to issue up to 3.5 billion yuan-denominated A shares as it needs 17.3 billion yuan ($2.7 billion) to buy new equipment, supplement working capital and fund four clean energy and infrastructure projects, including one in Cambodia, it said in a prospectus.

The new issue, to be listed on the Shanghai Stock Exchange, will represent close to 35 percent of its expanded share capital after the IPO, it said in the prospectus published in the official Shanghai Securities News.

The company said book-building would start on Tuesday and end on Thursday, and a price range for the IPO would be fixed on Friday.

Institutional subscriptions will start next Monday and subscriptions by retail investors will take place next Tuesday, with 50 percent of the new shares sold to each category of investor, re-allocatable depending on demand.

A final price for the IPO shares will be fixed on September 28, with money frozen for institutional subscriptions to be freed on September 29 and for retail subscriptions on September 30, it said.

Sinohydro has built 65 percent of the medium- and large-sized dams in China, including the Three Gorges Dam on the Yangtze River, the world's largest hydroelectric project, and the Xiaolangdi dam on the Yellow River.

As part of an overseas expansion drive, the firm has taken on projects in Malaysia, Sudan, Laos and Ghana.

It is also involved in other infrastructure projects, including the recently launched Beijing-Shanghai high-speed rail link.

China Securities Co. and Bank of China International are the lead underwriters for the listing, the prospectus said.

(Reporting by Lu Jianxin and Carrie Ho; Editing by Jonathan Hopfner)