Sinosteel Corp is likely to sell yuan-backed shares in Shanghai in the third quarter of this year to raise about 12 billion yuan (US$1.68 billion), industry sources said yesterday.

Sinosteel has picked underwriters including BOC International, JPMorgan Chase & Co and UBS AG for its proposed listings in Shanghai and Hong Kong, according to people briefed on the matter.

The Hong Kong issuance of Sinosteel may come right after its mainland listing, while the amount to be raised is expected to be settled based on market conditions then, the industry sources said yesterday.

"Sinosteel has long been eying a public stock sale and is determined to realize the goal by the end of this year," said a local investment-banking source. "The dual listings will not only help it raise funds for expansion but also boost its profile for overseas acquisitions."

Officials at Sinosteel were not available for comment yesterday. Shanghai Securities News reported earlier yesterday that the mineral trading group is set to kick off shareholding restructuring for the stock listings in March.

Sinosteel has been pursuing overseas resources assets in the past few years by investing in a slew of metal-exploration projects in such countries as Australia, Indonesia and Zimbabwe.

"The proceeds of the stock sales will be used to foster its acquisitions of overseas metal resources in the coming two years," said another securities source familiar with the matter. "There's no doubt the company will rev up its business abroad after the listings."

Sinosteel charted revenue of 111.24 billion yuan last year, up 83 percent from the same period in 2006, and is targeting about US$20 billion in sales in 2008, according to an earlier statement.

(Shanghai Daily, February 27, 2008)