Kazakh oil pipeline company aims to raise $186 mln in IPO

Tue Oct 30, 2012 3:17pm IST

* Order books on KazTransOil IPO to open by Nov. 6

* Pipeline monopoly to float 10 pct minus one share

* Listing to kick-start "People's IPO" programme

By Raushan Nurshayeva

ASTANA, Oct 30 (Reuters) - Kazakhstan's oil pipeline monopoly aims to raise $186 million in a share offering designed to attract private investors, the head of the country's sovereign wealth fund said on Tuesday.

KazTransOil's will launch an initial public offering (IPO) of 10 percent of the company minus one share by the end of the year, becoming the first state-run enterprise to take part in the former Soviet republic's "People's IPO" programme.

The company will sell shares at 725 tenge ($4.81), with priority given to local retail investors, said Umirzak Shukeyev, chief executive of the sovereign wealth fund Samruk-Kazyna.

Kazakhstan, Central Asia's largest economy, plans to invigorate the small local stock market and raise about $500 million from the first round of IPOs, selling between 5 percent and 15 percent of shares in several state-owned companies.

The government had planned to launch the programme by the third quarter of this year, but postponed the first listings because of the volatile global market.

Order books for the KazTransOil offering will open by Nov. 6 and close by Dec. 5, Shukeyev told a government meeting.

Samruk-Kazyna has said that it expects about half a million people from Kazakhstan's population of 16.7 million to participate in the five-year programme. State grid company KEGOC will also be among the first to float shares.

"This programme will enable us to attract investors to the economic growth of the country, both local investors and, in the future, probably foreign investors," Deputy Prime Minister Kairat Kelimbetov told the same government meeting.

KazTransOil shipped 67 million tonnes of oil through its pipelines last year, most of the crude exported by Kazakhstan. The country is the largest ex-Soviet oil producer after Russia and holds 3 percent of the world's recoverable crude reserves.

The 28 billion tenge ($186 million) IPO target for the pipeline company is slightly lower than the 30 billion tenge quoted by Shukeyev's deputy, Kuandyk Bishimbayev, on Oct. 12.

Retail investors will each be limited to a maximum investment of 7 million tenge, Shukeyev said. After their demand is satisfied, shares will be offered to local pension funds.

Shukeyev said that he expected demand from pension funds to cover two thirds of the KazTransOil offering.

The first round of IPOs is also set to include flag carrier Air Astana and gas pipeline company KazTransGas, shares in which could be sold next year.

The jewels in Kazakhstan's crown, including state oil and gas company KazMunaiGas and uranium miner Kazatomprom, will go public after 2015. (Writing by Robin Paxton; Editing by David Goodman)

Reuters Showcase

GDP Growth

GDP Growth

India revises up 2013/14 GDP growth to 6.9 percent.  Full Article 

Pharma Deal

Pharma Deal

Sun Pharmaceutical wins U.S. approval to buy Ranbaxy  Full Article 

Adani Restructuring

Adani Restructuring

Adani hives off power, ports businesses to boost growth.  Full Article 

Bank of Baroda

Bank of Baroda

Q3 net profit down 69 pct on higher provisions  Full Article 

Trading Fees

Trading Fees

BSE slashes fees in FX derivatives battle with NSE  Full Article 

SpiceJet Turnaround

SpiceJet Turnaround

SpiceJet board approves up to $243 mln share sale plan  Full Article 

Currency Market

Currency Market

RBI urges companies to hedge FX exposure  Full Article 

Banking Sector

Banking Sector

Banks say no room to cut lending rates, thwarting RBI easing  Full Article 

Reuters Poll

Reuters Poll

RBI seen holding rates steady on Tuesday, minority of analysts expect cut  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage