Sinotrans Shipping Ltd, poised to sell shares in Hong Kong, aims
to almost quadruple its dry-bulk shipping fleet in the next five
years because of China's rising commodities imports.
The shipping line plans to raise its dry-bulk capacity to as
much as five million deadweight tons from the present 1.3 million
deadweight tons by buying new vessels, it said in a statement
issued yesterday at a media briefing about its 11.45-billion HK
dollars (US$1.5 billion) initial public offering.
Sinotrans Shipping plans to expand its fleet as China's imports
of coal and iron ore have helped cause dry-bulk shipping rates to
surge. The Baltic Dry Index, a measure of chartering rates for
different sized vessels, has surged about 160 percent in the past
12 months, Bloomberg News said.
The Hong Kong-based firm said it also plans to boost its oil
tanker fleet to as much as 1.8 million deadweight tons from 832,000
deadweight tons over five years.
Response from investors to the IPO "has been very encouraging,"
said Daniel Ng, head of corporate finance at BOC International
Holdings Ltd, one of the two banks managing the sale. "People are
just trying to gauge where dry-bulk is heading."
Hong Kong tycoons Li Ka-shing and Lee Shau-kee are among
investors to have signed up for the sale, which is co-managed by
UBS AG. The shipping company is selling 1.4 billion new shares at
7.18 to 8.18 HK dollars each.
Sinotrans Shipping had a fleet of 34 ships, comprising 26
dry-bulk vessels, three oil tankers and five container vessels as
of June 30, according to the statement.
The company, a unit of China National Foreign Trade
Transportation (Group) Corp, is expected to price its shares on
Saturday, with trading due to begin on November 23.
(Shanghai Daily November 12, 2007)
