By Gillian Tan Just hours after we reported that Beijing-based LightInTheBox Holding Co. is seeking to list on the New York Stock Exchange, another Chinese company is pursuing an offshore listing, this time in Australia
Sino Australia Oil and Gas Ltd., which has all its operations in Northern China, is seeking to raise up to 20 million Australian dollars (US$21 million), according to a prospectus seen by MoneyBeat, ahead of a listing on the Australian Stock Exchange in June.
It is set to be the second-biggest IPO by a Chinese company in Australia since miner Blackgold International Holdings Ltd. BGG.AU 0.00% raised US$70 million in February 2011. Blackgold has fallen 44.2% since then. Another Chinese firm, payment authentication provider TTG Mobile Coupon Services Ltd. TUP.AU +3.23%, has risen 166.7% since its November listing.
Options in China for a listing are few: regulators in China stopped approving IPOs late last year, creating a backlog.
Sino Australia Oil and Gas, which is seeking a ticker of SAO.AU, is offering potential investors the exposure to China’s oil services industry, which it estimates to be worth 200 billion Chinese yuan (US$32.4 billion), with an annual growth rate of 15%.
The firm, a service provider to oil and gas producers, owns patents over oil and gas recovery technology in China, and aims to expand its patent protection globally once it lists, which will allow it to begin operating in target markets like Australia. Its Chinese operating entity is called Zhaoding Huaying Oil Drilling Technology Services Co.
Employees walk near oil pipes at a refinery in Daqing, Heilongjiang province —Reuters All Sino’s current contracts are with Chinese state-owned enterprises like China National Petroleum Corporation and PetroChina Company 601857.SH +0.94%, or their subsidiaries, which control the nation’s oil and gas production.
Its operations are focused in the Daqing Oilfield in China’s north, a region that has produced more than 10 billion barrels of oil since production began in 1960.
The company has forecast fiscal 2013 revenue of A$28.8 million, a 22% lift on the year prior.
“Our company has chosen to be listed on the ASX because Australia is one of Asia’s largest energy forums [with] rich oil, gas and mineral resources,” chairman Shao Tianpeng said in the prospectus. Mr. Shao will control 48.5% of shares in Sino if the entire A$20 million is raised.
Melbourne-based D2MX is lead manager on the IPO, which would be the third-largest IPO by deal size in Australia this year if it listed today, according to Dealogic.
