SHAANXI Coal Industry Co. said yesterday it plans to raise 9.8 billion yuan (US$1.62 billion) with a listing on the Shanghai Stock Exchange, setting the stage for a flood of deals in coming weeks with China’s largest initial public offering (IPO) since late 2011.

    The deal is among 11 already approved by the China Securities Regulatory Commission (CSRC) since the regulator ended a freeze on IPOs that started in late 2012. Shaanxi Coal will begin book-building from Jan. 10-14 and wrap up subscriptions by Jan. 17.

    More than 30 companies are already lined up to list in Shanghai and Shenzhen and Ernst & Young estimates that total fundraising this year could top 200 billion yuan, nearly twice the amount raised in 2012.

    The size of the Shaanxi Coal IPO, which will be the biggest since Sinohydro Group Ltd.’s 13.5 billion yuan listing in October 2011, was reduced by 43 percent from the company’s original fundraising target of 17.2 billion yuan, previously announced in 2011.

    Shaanxi Coal plans to issue up to 10 billion shares, or 10 percent of its expanded capital base after the IPO, according to the IPO prospectus.

    The company said proceeds from the deal will be used to boost its coal reserves, increase production and for the construction of coal transport facilities. The firm will also use the funds to replenish its working capital.

    (SD-Agencies)