China to trial $300 billion equities sale

| May 2, 2005 | 0 Comments
China trials $300 billion equities sale

China has approved the sale of state holdings to foriegn investment in a number of specified companies.

The state holdings involved amount to around two-thirds of the equity in businesses that have a stock market value of $400 billion.

The program is a trial that will include a small number of companies, according to the China Securities Regulatory Commission.

Rules for the trial, which take effect immediately, include a requirement that the commission and two-thirds of shareholders must approve the sales, effectively giving the state veto power over the transactions.

In addition, the rules provide that purchasers of state shares may not sell them in the first year, and after that they will only be able to sell a maximum of 5 percent of a company’s equity in any 12-month period.

This is the third try at resolving the problem of the sale of state holdings in Chinese companies, after unsuccessful attempts in 1999 and 2001.

The statement did not indicate which sectors and companies would be allowed to participate in the trial program.

Comments (0)

Trackback URL | Comments RSS Feed

There are no comments yet. Why not be the first to speak your mind.

Leave a Reply

Visited 980 times, 2 so far today