Railroads News
- China Railway Group plans share sale
Date: 2-Nov-2007 Sources: (Shenzhen Daily)
CHINA Railway Group, a unit of China Railway Engineering Corp., said Thursday it would issue up to 4.675 billion new A shares in an initial public offering (IPO) on the country's domestic stock market.
The deal is expected to raise between US$3 billion and US$4 billion, according to sources familiar with the deal.
Proceeds of the A-share issue, which will account for 26.75 percent of the company's expanded share capital of 17.475 billion shares, will be used to fund new production lines, invest in railways and develop property projects, China Railway Group said.
The China Securities Regulatory Commission said it would consider next Monday the company's IPO application.
China Railway Group, a construction contractor, also said it planned to issue up to 3.326 billion H shares in Hong Kong and was looking for a suitable opportunity.
'We will also seek a chance to issue H shares, though we are unable to guarantee that the H shares will be issued,'the firm said in a preliminary prospectus.
Proceeds of the H-share offer would be used to expand the overseas business of China Railway Group, which has already built over 230 projects in 55 countries, it said.
Money would go towards buying equipment overseas, investing in two copper and cobalt mines in Africa, repaying foreign debt and supplementing working capital, it said.
China Railway Group had assets of 153 billion yuan (US$20.5 billion) at the end of June.
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