Goldwind aims to rank among top 3

Beijing: Xinjiang Goldwind Science & Technology, which plans to raise more than $1 billion selling shares in Hong Kong, said it aims to rank among the world's three largest makers of wind turbines within five years.

Goldwind, the fifth-largest manufacturer globally, plans to increase production in the coming years, Chief Executive Officer Wu Gang told a media briefing in Hong Kong, declining to give details.

Goldwind could raise about HK$8 billion ($1 billion) after expenses have been deducted, in a public share sale in Hong Kong this month, it said in a statement. The company will use the cash to expand production capacity as the Chinese government encourages the use of wind power to help reduce the country's reliance on more polluting coal and oil.

Goldwind will spend about 40 per cent of the share-sale proceeds on building plants, 24 per cent to expand overseas, 15 per cent for design and development, 11 per cent to pay loans and 10 per cent as working capital, the statement said.

Turbine sales at the Urumqi-based company reached more than 2 gigawatts last year compared with 1.37 gigawatts in 2008, according to a share-sale prospectus.

Goldwind will likely increase consolidated profit by at least 26 per cent to 2.2 billion yuan ($322 million) this year, the prospectus showed. Revenue totalled 10.7 billion yuan last year, with 99 per cent of sales coming in China. About 144 million yuan of revenue came from overseas.

Expansion abroad

The company has a wind-farm project in the US and is looking at setting up others, according to the prospectus. It also has a production base at subsidiary Vensys AG in Germany. Goldwind wants to increase sales in the US and Europe, Wu told the briefing.

The company has completed prototypes for 2.5-megawatt and 3-megawatt turbines and is developing a 5-megawatt model, according to the prospectus.

China wants to install 150 gigawatts of wind power by 2020, compared with 25.5 gigawatts installed as of last year, Bloomberg New Energy Finance said in a May report.

The turbine producer, already listed on the Shenzhen Stock Exchange, is offering 395.3 million new shares, equivalent to a 15 per cent stake, at HK$19.80 to HK$23 each, according to yesterday's statement.

Shares gain

The shares gained 19 per cent in Shenzhen this year compared with a 14 per cent decline by the benchmark Shenzhen Composite Index.

Hong Kong's Hang Seng Index has slid 11 per cent since April 9 as the debt crisis in Europe reduced investors' willingness to take risk, leading at least three companies to abandon Hong Kong initial public offerings.

They include Swire Properties Ltd, which scrapped a plan to sell shares in Hong Kong on May 6 as the Hang Sang posted its biggest weekly drop since November, its parent said.