China’s Longxing Chemical to raise $91.8m from Shenzhen IPO

22 June 2010 07:05  [Source: ICIS news]

SHANGHAI (ICIS news)--China’s second-largest carbon black producer, Longxing Chemical Industry Co, plans to raise yuan (CNY) 625m ($91.8m) through an initial public offering (IPO) of up to 50m shares at the Shenzhen Stock Exchange, the company said on Tuesday.

The shares - at issue price of CNY12.50 each - would be open to individual investors on 23 June, the Hubei province-based company said in a disclosure to the stock exchange.

According to the disclosure, the company will build more carbon black units and replenish the working capital through the IPO, in line with strong demand from the downstream tyre sector.

By 2012, the company’s carbon black capacity was expected to rise to 300,000 tonnes/year from the current 180,000 tonnes/year.

However, the capacity would still be 120,000 tonnes/year lower than China’s largest carbon black producer Jiangxi Blackcat Carbon Black Co, Longxing said.

China’s Guosen Securities is the lead underwriter of the offering, the company said.

“The shares will be listed on the Shenzhen Stock Exchange early next month,” a source from the underwriter said.

Carbon black is widely used in tyres and rubber products.

($1 = CNY6.81)

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By: Judith Wang
+65 6780 4359

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