Others News
- Rival's offering can top Cosco's
Date: 21-Nov-2007 Sources: (People's Daily)
China Shipping Container Lines Co, Asia's second largest cargo-box carrier, may raise as much as $2.4 billion selling shares in Shanghai to buy ships as the country's booming exports fuel sea-freight traffic.
The shipping line plans to sell as many as 2.34 billion shares, it said in a Hong Kong stock exchange statement, without giving a price range. The potential value of the sale was calculated based on Monday's HK$7.86 closing price for the company's Hong Kong-listed stock.
The sale may exceed the $2 billion raised by larger rival China Cosco Holdings Co in its Shanghai stock offering in June, underscoring demand for shipping shares. China Shipping's Hong Kong stock has surged almost sixfold this year as a 26.5 percent jump in Chinese exports has helped to drive up freight rates.
'Investors will support the share sale and give a premium to the stock as the mainland still has limited investment channels,' said Edward Wong, an analyst at Quam Ltd in Hong Kong. 'Investor confidence will be supported by the recovery of freight rates. The shipping market is still on an uptrend.'
Chinese companies have raised at least 395 billion yuan in domestic share sales this year, more than the combined amount in the previous five years.
Five Hong Kong-listed Chinese companies - PetroChina, China Shenhua Energy, China Construction Bank, Ping An Insurance (Group) and Bank of Communications - raised 255.5 billion yuan between them in the five largest domestic share sales this year.
China Shipping's share sale will fund the purchase of new ships and related assets, as well as the repayment of loans, the company said in an August 9 Hong Kong stock exchange statement. It had then said it would sell 1.5 billion shares.
The securities regulator will meet to review the share sale plan on Friday, it said in a statement on its website.
Orient Overseas (International) Ltd, China Cosco and other Chinese shipping lines are expanding as the nation's rising trade boosts sea freight demand. About 90 percent of world trade moves by sea.
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