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Air China seeks Shanghai listing
(AP)
Updated: 2006-02-10 15:14
Air China, mainland China's de facto flagship carrier, said Friday it was
seeking permission to list shares on the Shanghai Stock Exchange, saying
proceeds from the sale would help finance major aircraft purchases.
The airline, whose shares are already traded in Hong Kong, did not say how
much it expects to raise from the share listing -- likely encouraged by
regulators hoping to improve the quality of companies with shares traded on
domestic bourses.
The decision to apply for the Shanghai share listing was approved by Air
China's board on Wednesday, the Beijing-based company said in a notice to the
Hong Kong Stock Exchange.
It plans to sell no more than 2.7 billion yuan-denominated shares, or about
28.62 percent of its existing share capital, to qualified institutional
investors, the notice said.
The shares will be priced no lower than the equivalent of 90 percent of the
average price of its shares traded in Hong Kong during the consultation period
for the new listing, it said, adding that market conditions would also play a
role.
The funds raised will help pay for the purchase of 20 Airbus A330-200s, 15
Boeing 787s and 10 Boeing 737-800s as well as expansion of ground facilities at
Beijing's Capital International Airport, it said.
Plans for those aircraft purchases were announced earlier.
Air China, the former government monopoly carrier, operates many of China's
international flights -- including nonstop from Beijing to New York.
The share listing requires the approval of the China Securities Regulatory
Commission and other government agencies, it noted.
The securities watchdog has suspended new share listings while it drafts new
rules taking into account a shareholding reform program now underway aimed at
eliminating nontradable, mostly government-held shares.
Air China's listing will come only after those rules are issued, the company
said.
However, it also noted that it expected to make its listing application
around the end of March.
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