Petro-king launches IPO

Start of institutional bookbuilding in Hong Kong prelude to raising up to US$109m.

Oilfield services company Termbray Petro-king Oilfield Services on Feb. 22 launched its Hong Kong initial public offering that aims to raise between US$90 million to US$109 million. The retail portion of the deal opened the same day.

Before the launch, Petro-king signed up five cornerstone investors that committed to invest a total of US$35 million in the IPO. That means the cornerstone tranche accounts for between 32% and 39% of the deal, depending on the final price.

The investors are Minmetals Private Equity (US$10 million), Value Partners (US$10 million), Everbright Private Equity (US$9 million), Clarion Valley Capital (US$4 million) and SinoSteel (US$2 million). They are subject to a six-month lock-up.

Hong Kong’s biggest IPO so far this year was Chinalco Mining Corporation International’s US$399 million offering in January. The second largest was a US$160 million IPO by PanAsialum, a Chinese maker of iPad casings and aluminum products.

Petro-king is one of China’s biggest makers of a number of high-end oilfield technologies such as turbine-drilling and multistage fracturing. It posted HK$92 million in profit in 2011, up from HK$77 million in 2009.