Comprehensive M&A data with integrated detailed company information

Sinochem Energy may seek Shanghai listing: Bloomberg
Posted on Wednesday, 13 March 2019 13:42
Sinochem is now considering listing its oil and petroleum products arm on the mainland, Bloomberg reported, after allowing an application for an initial public offering (IPO) in Hong Kong to lapse.

People close to the situation told the news provider the state-owned enterprise (SEO) has already asked China Securities Regulatory Commission whether a flotation in Shanghai would be allowed.

However, this does not mean the Hong Kong bourse is now out of the running as a venue, despite receiving lukewarm interest first time round, the sources noted.

Bloomberg added an IPO of Sinochem Energy would coincide with preparations for a reported merger with another dominant industry giant, China National Chemical.

The mooted amalgamation would be in line with Beijing’s mixed-ownership policy, which aims to introduce more private capital in SEOs, most of which are mired in debt.

Mainland-incorporated Sinochem Energy trades in crude oil and refined petroleum products, but is also involved in refining, storage and logistics, marketing and distribution, and providing brand management.

In fact – blowing its own trumpet somewhat – the group said in its original Hong Kong prospectus that it is a trailblazer in the ongoing reform of the country’s hydrocarbon industry.

Sinochem Energy operates one of the most competitive refining complexes in Asia, Quanzhou refinery in Fujian province with a designed annual processing capacity of 12.00 million tonnes of crude oil per year.

The company is currently expanding this facility to increase annual output to 15.00 million tonnes and to diversify into ethylene and derivatives, and aromatic products, such as paraxylene.

Sinochem Energy’s branded service station network was the fourth-biggest in China, with 568 locations, and a further 239 Sinochem-labelled third party sites, as of 31st March 2018.

The group also boasts of being the largest commercial storage and transportation provider of crude oil, refined petroleum and petrochemicals in the country by warehouse capacity in 2017.

It generated total revenue of CNY 392.11 billion (USD 57.49 billion) in the 12 months ended 31st December 2017 (FY 2016: CNY 261.35 billion), and of CNY 120.04 billion in Q1 2018 (Q1 2017: CNY 106.60 billion).

© Zephus Ltd