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Posted: 27 September 2005 1208 hrs

China Construction Bank to launch IPO on Oct 27 or 28

http://www.channelnewsasia.com/stories/afp_asiapacific_business/view/170499/1/.html

SHANGHAI : China Construction Bank (CCB), the third largest of the mainland's "big four" lenders is expected to launch its massive public share sale on October 27 or 28 in Hong Kong, state press reported.

The CCB is expected to place two billion dolllars worth of shares with institutional investors starting from Tuesday at the latest, the official China Securities Journal reported Tuesday, citing market sources.

CCB is expected to raise more than six billion dollars dollars in all via its Initial Public Offer (IPO), although a report by the Hong Kong Standard said the bank could raise as much as 7.7 billion dollars, making it the biggest IPO in the territory.

An initial price range of 1.42-2.27 Hong Kong dollars a share or 1.29-1.87 times 2005 book value, has been floated by the sale's book runners, the newspaper said, quoting fund managers.

That means the final size of the offer could fall between 4.8 billion dollars and 7.7 billion dollars for the 12 percent stake.

Morgan Stanley, China International Capital Corp and Credit Suisse First Boston are the underwriters, with lender CSFB indicating this week it would spend 500 million dollars to take stake in the bank.

CCB would be the first overseas IPO of the country's big four state-owned banks, which includes Bank of China, the Agricultural Bank of China and the Industrial and Commercial Bank of China.

In December 2003, the CCB and Bank of China received 22.5 billion dollars each to tidy up their balance sheets.

China's banks have long struggled with severe debt problems, a major hangover from the country's central planning days when easy credit was granted without concern about repayment of the loans.

Regulators hope that pushing state-owned banks to go public will bring greater transparency to the sector.

- AFP

 

 

 

 

 


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