Sinohydro Group Ltd., China’s biggest builder of dams, applied to raise funds for 17.3 billion yuan ($2.7 billion) of projects in an initial public offering in Shanghai that would be the nation’s biggest in almost a year.
The company plans to sell as many as 3.5 billion shares in the offering, according to a company statement posted to the website of the China Securities Regulatory Commission. The commission will review the IPO application on July 29, the regulator said.
Sinohydro is building hydroelectric stations and wind farms in China as part of the government’s push to reduce the nation’s reliance on coal to fuel the world’s second-largest economy. The Beijing-based company has also expanded overseas, winning construction contracts in Asia, Africa and South America.
Proceeds from the company’s offering will help fund the construction of projects including a hydropower dam in the southwestern Chinese province of Sichuan and a wind farm in the northern province of Gansu, according to Sinohydro’s statement. Funds will also be used for a hydro dam in Cambodia, the company said.
The initial offering would be the biggest since China Everbright Bank Co. raised 18.9 billion yuan in August. The exercise of Everbright Bank’s over-allotment option in September increased the amount it raised to 21.1 billion yuan.
Sinohydro’s net income gained 27 percent last year to 2.91 billion yuan on increased demand for hydropower facilities, according to the statement. The company had 261 projects under construction in 55 countries at the end of 2010, with sales from overseas projects accounting for 26 percent of the company’s total revenue and 35 percent of gross profit, it said.
The Chinese dam builder signed a $2 billion framework agreement with Laos to build seven dams along the 475-kilometer (295-mile) Nam Ou river, a Mekong tributary, the Hong Kong-based South China Morning Post reported in April.
Sinohydro in June of last year won a contract to help Ecuador build a $1.68 billion hydropower plant in the country’s Amazon region in what would be the Latin American country’s biggest engineering project, Ecuador’s Strategic Sectors Ministry said.
