Yancoal Australia plans US$800m listing in Hong Kong

Hong Kong

ASX-listed Yancoal Australia is planning a dual primary listing in Hong Kong this year which could raise about US$600m-US$800m, according to people familiar with the situation..

Yancoal Australia, which is 65.5 per cent owned by Chinese coal giant Yanzhou Coal Mining, is working with advisers on the transaction, which is expected to hit the market in the fourth quarter of the year, say the people.

The company hopes to improve its liquidity in the secondary markets through a Hong Kong listing, which is closer to the Chinese investor base, says one of the people. As of June 14, the 90-day average of Yancoal's daily trading volume in Australia was 840,072.02 shares, according to Thomson Reuters data. On June 14, only A$427,800 (S$430,770) of Yancoal shares changed hands on ASX. A dual listing in Hong Kong will allow Yancoal to be closer to its Chinese shareholders, said another person close to the deal.

Apart from Yanzhou Coal, Cinda International and China Shandong Investment own respective 16.7 per cent and 5.7 per cent stakes in Yancoal. A spokesman from Yancoal said the company would not comment on market speculation when contacted by International Financing Review (IFR).

Yancoal, the Australia unit of Yanzhou Coal, listed on the Australian Securities Exchange in 2012 after merging with Gloucester Coal, according to Yancoal's website. Last September, Yancoal raised US$2.35 billion from a 23.6-for-1 rights issue to fund its acquisition of Coal and Allied Industries from subsidiaries of Rio Tinto. Troubled commodities trader Noble Group and one other minority shareholder tried to block the highly dilutive offering, but failed. REUTERS