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Subscribe lohh..more kopi $$$ coming...look like it's the cheapest at $0.38c
Ouhua Energy Holdings Ltd has launched its IPO of 137m new and vendor shares at $0.38 each. Of the shares, 90m are new and 47m are vendor shares. The IPO comprises a retail tranche of 5m shares and a placement tranche of 132m shares.
Net proceeds from the sale of $30.5m will be used to expand the group's LPG distribution network in China, upgrade its production factlities and provide general working capital, it said.
The IPO, which is being handled by Stirling Coleman as manager and UOB Kay Hian as underwriter and placement agent, will close on Nov 1 and trading is expected to begin on Nov 3.
Ouhua Energy's earnings have steadily increased in the past three years, with its net profit rising from RMB3.69m in 2003, to RMB34.04m in 2004 and RMB80.51m in 2005.
China's 3rd-largest distributor of liquefied petroleum gas (LPG) plans to sell new and vendor shares in its mainboard IPO to raise capital to expand its sales network and improve production facilities. Ouhua is a tier-one LPG distributor and imports raw materials like butane and propane for its production facilities in Guangdong. It may raise as much as $40m from the sale of 25% of its enlarged share capaital. But demand is so strong that the offering may reportedly be increased to 30%.
2005 sales reached RMB2.49b with net profit of RMB80.5m - a yoy increase of 40% and 136% respectively. Based on a probable 8-10x PE, Ouhua could have an indicative market cap of about $100m before the pre-IPO capaital increase.