From the FT – PETRONAS Chemicals’ IPO: so many unanswered questions

September 14, 2010

A commentary on PETRONAS Chemical’s listing by a Financial Times blog post, dateline 2010-10-09:

The publication of the draft prospectus for an initial public offering is rightly regarded as an important moment in the process. It tells investors that the sale really is going ahead. But sometimes it doesn’t tell them much more than that.

The draft prospectus for the IPO of Malaysia’s newly formed PETRONAS Chemicals Group is a case in point: large parts of the document filed with the Securities Commission of Malaysia consist of rows of black dots and notes on contingent uncertainties.

Add to that the lack of clarity about how much of the company PETRONAS is putting up for sale, and it’s not surprising that no analyst has yet felt able to produce a comprehensive analysis of the company’s financial prospects and potential market valuation. (If there’s one out there, please let us know; you can contact us as explained here.)

Uncertainties abound. The 22 companies that make up the group have no joint operational or financial history, except as subsidiaries of the main PETRONAS group, and the new Chemicals group management has not yet had a chance to run the unit as a single entity.

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From the Star – PETRONAS Chemicals to list at PE of 15 times

September 12, 2010

From the Star, dateline 2010-10-09:

PETALING JAYA: PETRONAS Chemicals Group Bhd is likely to list at a price earnings multiple of around 15 times earnings, similar to what analysts are expecting in the coming listing of Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE), industry experts familiar with the exercise said.

The sources added that PETRONAS Chemicals would have a number of anchor investors, made up of both local and foreign institutions.

“As expected, the Employees Provident Fund will be wooed but so too will other funds, considering the size of the offering,” one banker said. Although no details have been revealed on the size of the offering, it has been reported that banking sources familiar with the company reckon it could be valued as much as US$2bil (RM6.2bil).

In a draft prospectus filed on Tuesday with the Securities Commission, PETRONAS said it had merged 22 chemicals companies to form the new group.

You can subscribe to an online version of the paper at the Bluehyppo site, follow links to e-browse.

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