Shandong International Transportation Corp (SITC) has priced its initial public offering (IPO) at HKD4.78 ($0.61) per share.
The pricing is at the bottom of a previously indicated range and is expected to raise just under HKD3bn ($384m).
SITC is offering 650m shares plus close to a 100m in over allotment shares for a listing on the Hong Kong Stock Exchange.
Under the IPO SITC will sell 585m shares for the international offering and 65m shares have been made available for the Hong Kong offering
“The offer shares initially offered under the international offering have been comfortably over-subscribed,” SITC said.
It intends to use around 45% of the net proceeds to buy between 15 and 25 newbuilding or secondhand vessels depending on market conditions.
Around 20% will go towards additional containers, while 25% will be used to expand its logistics business. The last 10% will go on working capital and general corporate purposes.
SITC, which targets the intra-Asia sector, is listed as owning 13 containerships with capacities ranging between 378-teu and 907-teu.
The fleet is relatively young with the majority built in 2006 and 2007 and others in 2004, 2002 and one in 1997.
It also controls a further 40 or so ships through long-term charters. It operates 49 routes across China, Japan, South Korea and Southeast Asia.
“We’re pretty positive on the intra-Asia. SITC is listing in Hong Kong and we’ve priced it on the upper end,” said Teddy Tsai, deputy head of research in Asia for DnB NOR.
