Singapore share market news
IPO Singapore stock : China Oilfield Technology offers 211.6 million shares at S$0.60 each on SGX Mainboard
China Oilfield Technology Services Group Limited, (”China Oilfield Technology”), a “one-stop” customised solutions provider of integrated tertiary oil recovery equipment and technology to enhance the extraction of oil in the Daqing oilfield region of the PRC, announced it has registered its final prospectus with the Monetary Authority of Singapore in conjunction with its proposed listing on the Mainboard of the Singapore Exchange Securities Trading Limited (”SGX-ST”).Its initial public offering (”IPO”) of 211,607,000 shares at S$0.60 each (the “Shares”) opens at 9.00 am on 8 October 2007 and closes at 12.00 noon on 15 October 2007. Trading of China Oilfield Technology’s Shares, in board lots of 1,000 Shares each, is expected to commence on 17 October 2007.
HL Bank is the Manager, Underwriter and Placement Agent for the IPO. Kim Eng Securities Pte. Ltd. is the Principal Sub-Placement Agent.Of the 211,607,000 Shares on offer, 127,500,000 are New Shares and 84,107,000 are Vendor Shares.
The IPO comprises 3,228,000 Offer Shares that are available for public subscription, and 208,379,000 Shares by way of placement.Representing 29.04% of China Oilfield Technology’s post-Invitation enlarged share capital of 728,595,000 Shares, the Shares are being offered at a pre dilution price earnings ratio of 18.39 times, based on the Group’s audited net earnings of RMB97.7 million for the financial year ended 31 December 2006.
Use of ProceedsThe net proceeds of approximately S$71.4 million will be used as follows:(a) Enhance its research and development capabilities(i) S$3.0 million for further research and development of its alkaline surfactant-polymer (”ASP”) injection technology(ii) S$3.0 million for further research and development of ASP residual liquid treatment technology and related chemical agents(b) S$24 million to expand its production capacity(c) S$4 million to expand its sales and marketing network in the PRC and overseas markets(d) S$37.4 million as general working capital
About China Oilfield Technology Services Group Limited
Based in Heilongjiang Province’s Daqing oilfield region, one of the largest oilfields in the PRC, China Oilfield Technology’s core activities lie in the research, development, manufacture and sales of customised integrated equipment and products that are used in enhancing the extraction of crude oil.With a strong emphasis on research and development (”R&D”) and product quality, China Oilfield Technology incorporates proprietary technology in tertiary oil recovery, and provides practical and cost effective technical solutions to cater to its customers’ needs. Backed by 40 full-time R&D personnel, the Group has developed various patented oil extraction equipment and technology over the years.
The Group has production facilities located in Daqing City, Heilongjiang Province of the PRC, and R&D facilities located in Beijing and Daqing City.In October 2004, China Oilfield Technology acquired a 348,792-sqm site for the construction of a new production complex, Dafeng Industrial Park, in the Third Zone of Hi-Tech Development Zone, Daqing City. The first phase of the Park is targeted to be completed by end 2007.
Financial Highlights
Fuelled by the demand for tertiary oil recovery, China Oilfield Technology’s revenue has grown from approximately RMB49.7 million in FY2004 to approximately RMB149.4 million in FY2006. The Group’s net profit grew from RMB17.7 million in FY2004 to RMB97.7 million in FY2006.
In the first five months of FY2007 (”FP2007″), the Group posted a revenue of RMB34.3 million (compared to RMB29.8 million in FP2006), and net profit of RMB17.4 million (compared to RMB12.4 million in FP2006). A major portion of the Group’s sales are typically recognised in the second half of the year.
As at 31 May 2007, the Group has secured confirmed sales orders amounting to approximately RMB93.7 million, which are usually fulfilled within six months.
