CHINA Shipping Container Lines Co said yesterday it will launch its initial public offering on the Shanghai Stock Exchange next week, which will help it expand its fleet and acquire container line-related assets.
The company, already listed in Hong Kong, plans to issue up to 2.3366 billion yuan-denominated A shares in Shanghai, which analysts expect could raise about 14 billion yuan (US$1.9 billion).
In its prospectus, CSCL said it will use 8.8 billion yuan of the proceeds to buy 16 container vessels. The shipper announced a US$1.36-billion order to buy eight ships from South Korea's Samsung Heavy Industries Co in August.
In addition, two billion yuan will be used to acquire assets related to its core business, such as port operations and leasing activities, and 1.2 billion yuan will be used to replenish working capital and repay bank loans.
The A share issue will account for 20 percent of CSCL's enlarged share capital.
CSCL will open the A share applications to subscription next Tuesday and Wednesday. The book building process started yesterday, and the offer price will be fixed next Thursday, it said.
CSCL said its earnings per share this year could be 0.277 yuan, based on the estimated 2007 net profit of 3.23 billion yuan.
Founded in 1997, Shanghai-based CSCL is the world's sixth-largest container line. As of June 30, the company manages 151 container ships with total operating capacity of 427,107 20-foot equivalent units.
Chinese shipping lines are expanding as the nation's rising trade boosts sea-freight demand.
CSCL's H shares closed at HK$6.17 (79 US cents) yesterday, up 0.65 percent.