South Korean oil refiner Hyundai Oilbank has delayed plans for an initial public offer worth up to $2 billion amid investor concerns over its links to Iran, sources said, the second major Asian IPO to be snagged by Western sanctions aimed at Tehran.     

Hyundai Oilbank, controlled by Hyundai Heavy Industries, initially aimed to list in South Korea as early as May, but is now looking at the second half of the year, three sources with knowledge of the matter told Reuters on Thursday.     

"The concerns around Iran arose and people have been analysing what impact they could have on the listing," said one of the sources, who requested anonymity because he was not authorised to speak to the media.     

The news follows Chinese state-owned aluminium producer Chinalco's decision to delay the $500 million Hong Kong IPO of an engineering subsidiary until at least June, on similar concerns, other sources said on Wednesday.      

The United States and Europe have tightened sanctions against Iran, targeting its oil exports in an effort to force Tehran to curb its nuclear programme. They say Iran is trying to develop nuclear weapons, an accusation Tehran denies.     

The sanctions noose has now been pulled so tight that it is not only hurting Iran but severely disrupting the businesses of its major oil customers worldwide.     

Hyundai Oilbank made about 20 per cent of its crude purchases from Iran last year, according to separate industry sources, a higher ratio than that of bigger local peer SK Energy.     

Chinalco's to-be-floated China Aluminum International Engineering (Chalieco) has business contracts with Iran, but these would have expired by the time of its delayed Hong Kong listing, said the sources familiar with that case.     

South Korea is feeling the pressure from its ally, the United States, which is leading the sanctions, to cut back on its Iranian crude purchases, which accounted for 9.4 per cent of its entire imports last year.     

South Korean refiners have been cutting Iranian imports to ensure Seoul can petition the United States for a sanctions waiver, a government source has said.      

Hyundai Oilbank said in a March 27 regulatory filing that it was trying to minimise any impact on imports from the sanctions against Iran by securing alternative sources.     

Hyundai Oilbank declined to comment on Thursday.     

A spokesman at Hyundai Heavy Industries, which owns 91 per cent of Oilbank, declined to comment on the possible delay of the IPO.     

The parent firm has not publicly given a time frame for the IPO and has yet to apply for preliminary approval from the Korean bourse.      

Hyundai Heavy has hired banks including Citigroup and BofA Merrill Lynch to underwrite the offering, according to sources. – Reuters