Brokerage plans for stock market entry
(Shanghai Daily)Updated: 2007-06-19 08:55 China's Merchants Securities Co has started preparations for a public stock offering as early as this year by hiring the mainland joint ventures of two international financial conglomerates as underwriters.
The Shenzhen-based broker under China's Merchants Group has
invited UBS Securities and Goldman Sachs Gaohua Securities to help arrange its
initial public offering, it said in a statement over the weekend.
Swiss bank UBS AG owns 20 percent of UBS Securities, which was set up early this year via a revamp of former Beijing Securities. Goldman Sachs owns 33 percent of its mainland venture, which was established in 2004.
Merchants Securities didn't say when or where it planned to list or how much it proposed to collect through the stock sale. But it usually takes nearly half a year for underwriters to advise the company before its eventual listing.
Earlier media reports said the broker might choose to issue yuan shares in Shenzhen instead of Shanghai partly because it is based there.
China's stock regulator is encouraging stronger securities companies to tap public funding for expansion as it hopes to boost competitiveness and transparency of domestic firms before opening the sector further to foreigners.
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China's stock exchanges now host only two public brokerage houses, Hong Yuan Securities Co and Citic Securities Co. Shanghai-based Haitong Securities early this month won regulatory approval to perform a back-door listing by buying a firm that's already trading.
"I expect broker shares will be hotly pursued by investors due to their scarcity and the companies' rosy growth potential," said Li Zhiming, an Orient Securities Co dealer.
(For more biz stories, please visit Industry Updates)
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