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Sinotrans Shipping IPO shares snapped up

Sinotrans Shipping IPO shares snapped up

Hong Kong: Sinotrans Shipping is reported to have sold 1.4bn shares in its Hong Kong IPO worth a total $1.5bn this morning, writes Bloomberg. The shares, priced at HK$8.18 ($1.05) each, represent a 35% stake in the company and will begin trading on the stock market on November 23. Sinotrans also has the option to increase the IPO by an additional 15%, which could boost the total proceeds to as much as $1.68bn if exercised in full.

The money raised will be used to increase the company's dry bulk capacity to five million dwt in order to cater to the booming market, particularly for coal and iron ore. It currently operates a fleet of 26 dry-bulk vessels, three oil tankers and five container ships and has 13 new vessels (including eight dry bulk vessels) on order. All the new vessels are due for delivery by end 2011. 

Sinotrans Shipping is expected to increase its net profit by 15% to $137m this year, before more than doubling the figure to $298.5m in 2008, according to the IPO's sponsors, UBS and BOC International.[19/11/07]