Sinopec IPO attracts demand of $5.63 billion

The Chinese government has taken a realistic attitude to the pricing of its latest privatisation in a bid to maintain positive momentum for the rest of the programme.

Fund managers have applauded the decision to bow to volatile global market conditions and price the 16.78 billion share offering for China Petroleum and Chemical Corp Sinopec just below the mid-point of the deal's indicative range. Confounding those who believed that Chinese officials would consider it a loss of face, the move also emphasises the government's determination to keep its huge privatisation programme rolling smoothly forwards.

As one London-based fund manager, who wished to remain anonymous, puts it, We have been very encouraged that the Chinese government seems to have taken a long term view of the privatisation process. Acknowledging that there are plenty more deals...

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