China Rongsheng Heavy Raises $1.8 Billion in Hong Kong Initial Share Sale

China Rongsheng Heavy Industries Group Holdings Ltd., the nation’s largest shipbuilder outside state control, raised HK$14 billion ($1.8 billion) in a Hong Kong initial public offering, terms for the sale show. Rongsheng sold 1.75 billion shares at HK$8 apiece after offering them at HK$7.30 to HK$10.10 each, the terms showed. The shipbuilder, based in Shanghai, has production facilities in eastern China’s Jiangsu Province and Anhui Province.
Morgan Stanley, CCB International, JPMorgan Chase & Co., BOC International Holdings Ltd. and Deutsche Bank AG managed the sale. Rongsheng plans to start trading on Nov. 19 with the ticker 1101, according to its IPO prospectus.
Investors including China Investment Corp., China National Offshore Oil Corp. and China Life Insurance (Group) Co. agreed to buy a combined $285 million of Rongsheng shares in the company’s IPO, the prospectus showed.
Rongsheng forecasts net income of at least 1.61 billion yuan ($242 million) this year, the prospectus said. The company had revenue of 8.17 billion yuan in the first eight months of 2010, up from 4.82 billion yuan in the same period a year earlier, the prospectus showed.
The company will use a quarter of the IPO proceeds for shipbuilding and offshore engineering and another quarter to repay loans, according to the prospectus.
As of Sept. 30, Rongsheng had received orders for building 84 vessels of a combined 15.1 million deadweight tons, the prospectus showed.