* Everbright, China Shipping delay planned HK share sales
* India state-run firms' share sales seen delayed
* APAC firms planned $90 bln in offerings by year-end -IFR
* Market rout dampens hope of European IPO market revival
* Weak trading, valuations hit US IPOs, share sales
(Adds details on AIG, ILFC)
By Elzio Barreto and Jing Song
HONG KONG, Aug 5 China Everbright Bank
(601818.SS) delayed its Hong Kong share offering of up to $6
billion, sources said on Friday, the latest casualty of a rout
in global equity markets which casts doubt over billions of
dollars worth of other fundraising plans.
World stocks sank for an eighth straight session on Friday,
wiping $2.5 trillion off their value on the week, as fears grew
that Europe's debt crisis was spinning out of control and the
U.S. economy could face another recession. [ID:nL6E7J50G1]
"Deals are going to get delayed and are going to be cut in
size," said Philippe Espinasse, a former investment banker with
Nomura and UBS in Hong Kong and author of 'IPO: a Global
Guide'. "You're going to see people revising their
U.S. auto and mortgage lender Ally Financial, which is
planning a $6 billion initial public offering and was hoping to
launch the offering in June, then considered the late summer,
has now postponed it until at least September, sources said.
A secondary offering of General Motors (GM.N) shares by the
U.S. Treasury also looks likely to be later than anticipated.
The Treasury had around $15 billion of remaining shares to sell
as of end-July, but GM's market value is down 10 percent since
then, cutting their value to around $13.5 billion.
The U.S. Treasury is also in the process of exiting its
investment in insurer American International Group Inc (AIG.N).
Its $8.7 billion May share sale accounted for only about 15
percent of its stake in the company. It has billions more worth
of stock to sell, but shares are now trading about 14 percent
below their May offer price.
AIG Chief Executive Officer Robert Benmosche said on
Thursday that he is closely watching the markets as he looks to
float the company's aircraft leasing unit ILFC as an IPO. The
IPO could value the company at $8 to $10 billion, a source said
Container leaser China Shipping Nauticgreen was among
others shelving IPO plans, said IFR, a Thomson Reuters
"It's not the right time to do it," said one Hong
Kong-based banker. "I would be cautious to rush the deals out
Anglo-South African financial conglomerate Old Mutual
(OML.L) (OMLJ.J) said market turmoil may delay a planned
listing of its U.S. fund management business next year.
While there were no big European listings slated for
August, with most bankers and investors on holiday, the rout
has hit secondary sales and clouds hopes for a September IPO
"We had been looking at a couple of bloc sales if there was
a big rally post the debt ceiling (agreement) but ... markets
are getting worse not better," said one London-based banker.
Sentiment in the European listings market, which has seen
more than 20 deals pulled this year, has been dented by poor
post-IPO performance from all but a handful of companies.
Commodities trader Glencore (GLEN.L), whose $10 billion
float is the world's largest so far this year, has dropped 20
percent since its debut.
Several big deals are due after the summer, including the
Spanish state lottery's 7 billion euro ($9.9 billion) IPO.
"We have all got a massive pipeline of deals to launch in
the first week of September, but the way the markets are at the
moment I can only imagine it is going to be 50 percent done, 50
percent failed," said the banker.
Siemens may delay the listing of its Osram lighting unit
after its valuation plunged, while ING ING.AS said it would
not launch the IPO of its insurance operations in these markets
and may consider a sale instead. [ID:nL6E7J40XJ]
GRAPHIC-Troubled Asia IPOs: link.reuters.com/nys92s
GRAPHIC-Asia H1 stock offers:
DEALTALK on Asia IPO valuations:
TURMOIL DARKENS OUTLOOK
China's Everbright in June postponed the launch of the
offering because of market conditions and was slated to begin a
roadshow next week ahead of a planned listing on Aug. 18,
sources with direct knowledge of the plan told Reuters.
The lender, which has secured $1.2 billion from cornerstone
investors, could slash the deal to between $2.5 billion and $3
billion, and may head back to the market in September, said
An Everbright spokeswoman was not available for comment.
The slump in markets could also delay big-ticket secondary
share sales in India's leading state-run companies, which were
expected to hit the market in the next few months, bankers
The government is now unlikely to meet its target of
raising nearly $9 billion through share sales in public sector
firms, including explorer Oil and Natural Gas Corp (ONGC.NS)
and Steel Authority of India (SAIL.NS), the bankers added.
Prolonged market turmoil could make it difficult for Bank
of America (BAC.N) to exit its $17.5 billion holding in China
Construction Bank (0939.HK) (601939.SS) when its lock-up
expires at the end of August, analysts and bankers said. It had
been expected to sell at least half its stake to boost its
"You need some stability in the markets before investors
look at deals again," said one equity capital markets banker.
"People are in a capital-protection mode now."
Equity issuance in the Asia region excluding Japan rose 3.5
percent to $109.1 billion in the first half of the year, the
second-highest for the six-month period since 2007, according
to Thomson Reuters data. Companies have unveiled plans for IPOs
and follow-on deals of nearly $90 billion, the data showed.
Chinese banks and insurers alone plan to raise up to $35.4
billion in share sales in Hong Kong and China by the end of the
year, while large nonfinancial deals include a $2.5 billion IPO
by China Sinohydro Group, the builder of the Three Gorges dam.
Chinese firms can tap the domestic market, convertible
bonds or private placement as other options, said Simon Yuan,
Credit Suisse's co-head of Financial Institutions Group, Asia
"But if the market sentiment is really bearish none of this
will work and the companies will have to slow down their pace
of growth and preserve capital by cutting dividend payouts,
China Everbright Capital, China International Capital Corp,
Morgan Stanley (MS.N), JP Morgan (JPM.N), UBS UBSN.VX, BNP
Paribas (BNPP.PA), BOC International, HSBC (HSBA.L) and Shenyin
Wanguo were hired to manage the Everbright Bank offering.
($1 = 0.706 Euros)
(Additional reporting by Denny Thomas in HONG KONG, Aipeng Soo
in SHANGHAI, Saeed Azhar in SINGAPORE, Sumeet Chatterjee in
MUMBAI, Kylie MacLellan in LONDON and Clare Baldwin in NEW
YORK; Editing by David Cowell and Tim Dobbyn)