AAG Energy considers reviving Hong Kong IPO

By VCPOST Staff Reporter

Jan 17, 2014 03:42 PM EST

Coal bed methane producer AAG Energy Ltd is considering reviving its plan for an initial public offering (IPO) in Hong Kong this year, according to its chairman. The company, which operates in Shanxi province, shelved its IPO plan a year ago, wrote South China Morning Post (SCMP).

Chairman Stephen Zou Xiangdong explained: "Our IPO plan is not just for the money, we are not short of cash. A stock market listing is better than a private share sale as it would give us a better valuation and our initial shareholders more flexibility on their investment."

The Chinese coal miner may offer more shares to help raise funds for its 2014 and 2015 operations, which may cost between $200 million and $300 million, the report detailed.

In 2012, AAG sought a $200-million IPO which was sponsored by JP Morgan and Barclays. However, the firm later scrapped that plan as it was not satisfied with the valuation that investors gave it, the report said.

AAG is 30% owned by American private equity group Warburg Pincus. Baring Private Equity holds a 25% stake in the Chinese firm, while Ping An Asset Management holds 12%. The remaining stake is owned by AAG's management and other investors, SCMP reported.

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