Gaoke Prepares for IPO


Jiangsu Gaoke Petrochemical is on the final phase of preparing for an initial public offering. According to a prospectus submitted to the China Securities Regulatory Commission, the lube supplier, based in Yixing, Jiangsu province, plans to raise about 22.3 million (U.S. $3.5 million) on the Shenzhen Stock Exchange.

The fund is expected to be used to build a new facility to supply 60,000 metric tons per year of highly refined lubes, a research and development center, and a distribution and service network.

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Gaoke primarily produces industrial lubes and automotive engine oils, with clients including Dow Corning, Wacker Chemie AG, and major Chinese transformer makers.

Gaoke buys base stocks mainly from China National Offshore Oil Corp. and China National Petroleum Corp. According to the prospectus, such centralized purchasing is a risk, in addition to the volatility of base stock price fluctuations and the highly competitive Chinese market.

In 2013, Gaoke earned 31.1 million in net profits, down 32 percent from 45.6 million in 2012.

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