China resumes IPOs after 1-year halt
(AP)
Updated: 2006-05-26 06:37
China is to resume initial public offerings on its stock markets after a
one-year break, as a major state-run engineering company announced Thursday
plans to issue 60 million shares on the Shenzhen Stock Exchange.
China halted IPOs and other new share listings in April 2005 as it launched a
program to shift government owned, nontradable shares into the market. Last
month, it began allowing sales of secondary securities by companies with shares
already traded on the Shanghai and Shenzhen exchanges.
China CAMC Engineering Co. said it would use funds raised by its June 5 IPO
to finance several projects, including some overseas. Pricing for the offering
is due on June 2.
Shanghai's benchmark stock index had fallen 4 percent in the previous two
sessions on worries that the expected resumption of IPOs might overwhelm demand,
pushing prices lower. But in trading Thursday, the market recovered after an
early decline, with the benchmark Shanghai Composite Index gaining just 0.03
percent to 1,591.43.
Beijing-based China CAMC, founded in 2001, is an engineering project
contractor owned by state corporation China National Construction &
Agricultural Machinery Import & Export Corp.
China CAMC reported 70.9 million yuan (US$8.9 million) in profit in 2005, up
slightly from 2004, according to the company's prospectus, which was published
in Thursday's China Securities Journal.
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