SINOCHEM Group has chosen BOC International, CLSA and Morgan Stanley as joint sponsors for the Hong Kong stock listing of its key oil assets that is expected to raise about US$2 billion, three sources with direct knowledge of the matter said.

Sinochem has also picked China International Capital Corp. (CICC), HSBC, ICBC International and JP Morgan to work on the initial public offering (IPO) expected in the second half of this year, said the sources.

The planned IPO for the State-owned group’s unit will likely include its oil refining, oil trading, storage and logistics, as well as distribution and retail businesses, but not its struggling upstream business — mostly overseas oil and gas production.

The proposed float comes amid a push by the government to inject new life into State-owned enterprises by encouraging private capital investment in the enterprises.

The government has been working towards creating bigger, stronger State firms, and building enterprises capable of competing globally. It is also weeding out excessive capacity in bloated sectors, but wants to avoid any risk of mass layoffs or a blow to economic growth.

Sinochem’s IPO plans have been pushed ahead by chairman Frank Ning, who joined the firm in early 2016 from food group COFCO, where he was well known for aggressive restructuring and M&A, Reuters reported in October.(SD-Agencies)