China National Nuclear Power Corp., one of the top two state
nuclear-power giants, will raise as much as $2.16 billion in what
is set to be the country's largest domestic initial public offering
in five years.
CNNPC plans to sell up to 3.89 billion new shares, or a quarter
of its total, in the sale, according to its IPO prospectus, filed
to the Shanghai Stock Exchange on Monday. The offering's expected
launch date is June 2.
The share float is poised to be the largest in the domestic
market since China Everbright Bank Co. raised $2.6 billion in
Shanghai in August 2010, according to data provided by
Dealogic.
China National Nuclear Group holds a 97% stake in CNNPC. About
40% of China's total nuclear energy is generated by operators
controlled by CNNPC. Excluding issuance-related fees, the firm will
raise 13.4 billion yuan ($2.16 billion), according to the
prospectus. CNNPC will allocate 4.18 billion yuan of the raised
capital to replenish its holdings of cash, and will invest the rest
in the construction of projects in Fujian, Zhejiang, Hainan and
Jiangsu provinces. Citic Securities, UBS AG and China Securities
are the underwriters for the deal.
The China Securities Regulatory Commission approved the IPO
along with those of 22 other companies on Friday.
China Nuclear Engineering Corp., meanwhile, plans to raise 2.7
billion yuan by issuing up to 525 million shares, according to a
preliminary prospectus released Friday on the securities
regulator's website.
Those planned offerings follow a successful listing in Hong Kong
by China's other dominant nuclear-power operator, China General
Nuclear Power Group, which raised $3.16 billion in an IPO in
December.
China's nuclear-power firms are turning to the red-hot domestic
market to raise capital for rapid expansion, after Beijing pledged
to rely more on renewable energy for power generation.
China suspended the approval of nuclear-power plants after
Japan's Fukushima nuclear disaster in 2011 due to safety concerns,
but the industry has since received fresh impetus after Beijing
stepped up efforts to reduce its reliance on coal.
China has 22 operating reactors on the mainland with a total
installed capacity of 20.3 gigawatts as of 2014, while 24 reactors
are under construction, including the world's first Westinghouse
AP1000 units, according to the China Nuclear Energy Association.
The country aims to more than double its capacity to at least 58
gigawatts by 2020 and around 150 gigawatts by 2030.
Yifan Xie
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