--Malaysia's UMW Holdings plans at least $500M IPO of Oil & Gas Unit - sources
--UMW Holdings has called banks to advise on Malaysia IPO of Oil & Gas Unit - sources
(Adds background on Malaysia's IPO market this year, background on UMW)
By P.R. Venkat and Jason Ng
Malaysian industrial conglomerate UMW Holdings Bhd. (4588.KU) is planning to raise at least $500 million through an initial public offering of its oil and gas unit next year, according to two people with knowledge of the deal, making it the latest entrant into the Southeast Asian country's sizzling IPO market.
Malaysia earned its chops as a global hot spot for new listings this year, bucking a global slowdown in IPO activity. According to data tracker Dealogic, Malaysia ranks fifth in terms of funds raised in IPOs after U.S., Japan, China and Hong Kong. In 2011, Malaysia ranked 14th with $2.3 billion raised, less than a third of the $7.5 billion it has racked up so far this year.
UMW, which is 44.34%-owned by Malaysia's state asset manager Permodalan Nasional Bhd., has called investment bankers that it is considering as advisors for the IPO, which is slated for next year, said the people with knowledge of the deal.
A UMW spokesman declined to comment.
With the addition of UMW, Malaysia has about $2.5 billion worth of IPOs in the pipeline for next year, including plans by Westports Malaysia Sdn. Bhd. to raise $1 billion. People with knowledge of the deal said previously that Westports--the country's busiest port, owned by entities linked to Hong Kong tycoon Li Ka-shing and Malaysian industrialist G. Gnanalingam--is aiming for an IPO within first half of next year.
Last week, Zainal Abidin Jalil, chief executive at Malaysian power company Malakoff Corp. Bhd., said his company is looking to raise $1 billion through an IPO in the second quarter of 2013.
Apart from oil and gas, UMW has business interests in automotive equipment, manufacturing and engineering. It has a joint venture with Daihatsu Motor Co (>> DAIHATSU MOTOR CO., LTD.) to manufacture Perodua-branded cars. It also assembles Toyota-branded vehicles, sells earthmovers and distributes lubricants.
Malaysia's recent IPOs have met with strong demand from both local and foreign investors. The institutional portion of hospital operator IHH Healthcare Bhd.'s (5225.KU) $2 billion IPO was oversubscribed by more than 60 times, while Felda Global Ventures Holdings Bhd.'s (5222.KU) $3.2 billion IPO was more than 40 times oversubscribed. During Astro Malaysia Holdings Bhd.'s (6399.KU) $1.5 billion IPO book-building, orders outstripped supply by more than 30 times.
Write to P.R. Venkat in Singapore at firstname.lastname@example.org and Jason Ng in Kuala Lumpur at Jason.email@example.com
Corrections & Amplifications
This article was corrected at 11:05 GMT to add the name of the Hong Kong tycoon in the fifth paragraph. The Hong Kong billionaire linked to Westports is Li Ka-shing.
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