China's Goldwind blows off U.S. IPO, stays at home

HONG KONG (Reuters) - China's largest maker of wind-powered generators, Goldwind Science and Technology Co. Ltd., has blown off plans for a U.S. IPO and chosen instead to list at home to try to bankroll a rip-roaring pace of expansion.

Goldwind, based in the northwestern region of Xinjiang, will submit listing documents to Chinese regulators this month at the earliest, Chairman Wu Gang told Reuters in a telephone interview from Xinjiang's capital of Urumqi on Sunday.

He would not say how much the company hoped to raise from the prospective share float, one of several by Chinese firms banking on a nationwide campaign to boost the use of renewable energy.

"We may submit listing materials to the regulator this month. We will definitely try to list this year," Wu said.

"Our main business is in China and we do not have many executives who have the experience working overseas. Besides, our shareholders cannot wait any longer for an IPO."

Wu told Reuters in 2006 that the company was in talks with Morgan Stanley (MS.N), Goldman Sachs (GS.N), Deutsche Bank (DBKGn.DE) and Citigroup (C.N), hoping to enlist them as financial advisers for a listing in the United States.

Now, the company had enlisted local brokers, including Haitong Securities, to help it with a domestic listing.

China wants to boost renewable power output to cover around 10 percent of its needs by 2010, and aims to have 30 gigawatts (GW) of installed wind power capacity by 2020, versus just 1.26 GW in 2005.

Beijing's encouragement of cleaner energy alternatives has helped Goldwind's turnover double in each of the past few years, and triple to 1.5 billion yuan ($196 million) in 2006.

Wu said last year that he was hoping for 4 billion yuan in revenue in 2008, but now said the target was "conservative" and that the firm would "surely exceed it."

The government push is also encouraging Chinese firms -- including solar cell makers Yingli Green Energy Co. Ltd. (YGE.N) and LDK Solar Hi-Tech Co. (LDK.N) -- to pursue major share floats in hopes of riding strong investor demand for alternative energy plays.

Yingli debuted this month after raising $319 million. LDK also listed in New York in June.

HEATING UP

Competition is heating up at home, with a dozen or so foreign players vying for a slice of the booming market, including global leader Vestas Wind Systems (VWS.CO), Spain's Gamesa (GAM.MC) and India's Suzlon Energy Ltd. (SUZL.BO).

But Chinese firms are also piling into technically complex wind turbine manufacturing, creating a supply glut and causing quality problems that may temporarily complicate Beijing's push towards cleaner energy, industry executives say.

More than 30 Chinese firms now offer wind-powered generating equipment, creating competition that should eventually push down global prices, but that Beijing hopes will create export powerhouses.

"Some companies are rushing into this field blindly. But this is still a highly concentrated industry," Wu said.

According to the company's analysis, the three largest firms in the sector accounted for some 80 percent of the country's market share over past years.

"I don't think that will change significantly in the future," he added.

The company is now cautiously eyeing development beyond its home turf. Goldwind ranked 10th-biggest among wind-turbine manufacturers in the world in 2006, accounting for 2.8 percent of a total 15,016 MW market worldwide, according to research firm BTM Consult.

"Our target is to be number eight by 2010," Wu said.

"We will be very prudent and start from small projects," he said without elaborating.

($1=7.654 Yuan)