PVD to raise $38 mln in share issue

Petrovietnam's drilling arm, PV Drilling (PVD), plans to raise $37.8 million via the issue of more than 42 million shares by September as it looks to grow its equipment leasing business and pay a dividend.

Exploration activity around Vietnam is expected to accelerate in the next few years, with 300 wells in operation during 2006-2010, the company said.

Chief Executive Do Van Khanh said in a statement seen on Monday that Petrovietnam Drilling and Well Services Corp. would issue the shares to existing investors and institutions.
PV Drilling said it has a 10% share of Vietnam's drilling market, but has around 80% of the market for providing drilling equipment and well maintenance services.

Ho Chi Minh City-based PV Drilling expects to raise 609 billion dong ($37.8 million) to "contribute 51% of the 1,000 trillion dong registered capital to establish PVD Invest Company and add to business funds," Khanh said.

PVD Invest will import oil rigs and drilling equipment to lease to oil and gas firms operating off Vietnam's coast. In a pre-issue prospectus, PV Drilling said PVD Invest would invest in a $200 million multi-functional jackup rig.

PV Drilling forecast 2007 net revenue would jump 61.8% to 2.3 trillion dong ($142.8 million) and net profit would more than quadruple to 560 billion dong as its new jackup started operations in March.

In August, PV Drilling expects to operate its first land rig in Algeria as part of its business expansion.

Its prospectus showed revenue growth would slow to 8.7% in 2008. It gave no reason for this.
Shares in PV Drilling closed down 2.4% on the Ho Chi Minh Stock Exchange on Monday, valuing the company at a little over $1 billion.

January-March net profit rose to 36.4 billion dong, around 30% of the 2006 full-year net, which itself more than doubled to 120 billion dong.

Khanh said PV Drilling will sell 31.28 million shares to existing shareholders next month under a 100-for-46 plan at 10,000 dong each. The shares will be listed on Aug. 17.

Existing investors are entitled to a 14% dividend payment in shares and a bonus share award, for which PV Drilling will issue a combined 9.52 million shares for listing on July 11.
Institutional investors will bid for the remaining 1.34 million shares before Sept. 4.

As of March 16, state oil and gas group Petrovietnam held 51% of PV Drilling. Foreign institutions and individual investors owned a combined 11.71%, the prospectus said.

State-run Vietcombank, slated for its own IPO in July or August, had a 4.41% stake in PV Drilling.

Source: Reuters