China Huaneng Group and Datang both reported to be seeking to go public before the end of the year
China’s two largest energy companies are moving forward with plans to float their renewable energy divisions on the Hong Kong Stock Exchange through initial public offerings (IPOs) that could raise over $2bn (£1.28bn).
According to Reuters’ reports citing sources close to the deal, China Huaneng Group and Datang Corp could both complete IPO’s for their green energy units before the end of the year, raising billions to help fund future expansion.
Sources said that Huaneng New Energy Industrial is looking to raise between $1bn and $1.5bn from an IPO that could take place as early as October, while Datang is moving towards floating its renewable energy division in December.
China International Capital Corp (CICC), Goldman Sachs, Macquarie and Morgan Stanley are expected to manage the IPO for Huaneng’s wind energy division, while Datang’s IPO is set to be handled by Deutsche Bank and UBS.
Market watchers will be keeping a close eye on the planned listings given the tumultuous nature of the global IPO market in recent months.
While a number of US renewable energy and clean-tech firms have pulled off better than expected IPOs over the past year, several firms have had to postpone or cancel green IPOs citing weak market conditions.
Significantly, China’s second-largest wind turbine manufacturer, Xinjiang Goldwind Science & Technology, postponed its planned $1.2bn in June amid concerns over market conditions. However, there have been reports that the company could reschedule the listing for as early as next month if conditions continue to improve.
