Underwriter hails Esso Thailand's IPO a success

23 April 2008 12:32  [Source: ICIS news]

BANGKOK (ICIS news)--This week’s baht (Bt) 9.3bn ($295.5m) initial public offering (IPO) of Esso Thailand, a unit of ExxonMobil Corp, was hailed a success on Wednesday after closing ahead of schedule. 
 

"We are very pleased with this highly successful IPO," Anuwat Ruamsuke, a director at Phatra Securities, the lead underwriter, told ICIS news.

 

The retail offering saw 1.09bn shares floated on Monday in Thailand's largest IPO in two years. Phatra reported the shares were 2.9 times oversubscribed.

 

The company’s shares would pay a Bt1 dividend this June, which worked out to a 10% yield, Anuwat said, as they were priced at Bt10 baht per share.

The Thailand division is 87.5% owned by ExxonMobil and 12.5% owned by the Thai Finance Ministry. The Finance Ministry sold 326.25m shares as part of the offering to domestic and foreign investors. 

  
"More than 10 or 20 companies have wanted to IPO but this is one of the few companies that has been able to IPO in this volatile market," Anuwat added.
 
Esso was Thailand's only fully integrated company that combined refining, petrochemicals, transport and retail, he said.

 

It has a large chemicals division that produces about 500,000 tonnes per year of paraxylene (PX). 

"Petrochemicals are by their nature cyclical and if the oil price rises, then PX will also rise. At this time, the market for petrochemicals in general is very volatile and it is impossible to predict prices on a month-by-month basis," said Anuwat.
 

Trading on the Stock Exchange of Thailand will open on 6 May.   

 

($1 = Bt31.5)

By: George McLeod
+65 6780 4359

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