CSCL gains regulatory permission for A-share IPO

CHINA Shipping Container Lines (CSCL) has received permission from the China Securities Regulatory Commission (CSRC) for its A-share initial public offering (IPO) in Shanghai, reports Xinhau.

The company, which owns and operates the country's largest container fleet, plans to raise at least CNY12 billion (US$1.6 billion) through the issuance of 2.34 billion new A shares.

The new A-share issuance would account for 20 per cent of the total number of stocks issued, according to the company's prospectus to the CSRC. After the issuance, the state-owned China Shipping (Group) Company would decrease its stake in CSCL, which is already listed in Hong Kong, from 59.8 per cent to 47.8 per cent.

The company announced that CNY8.8 billion of the proceeds would be used to buy eight containerships in China and an additional eight from overseas. About CNY2 billion would be used to purchase assets, including stakes in container leasing companies and CNY1.2 billion would be earmarked to replenish cash flow and pay bank loans.

As the world's 10th largest container line, Shanghai-based CSCL manages 151 containerships. Its total operating capacity ranks sixth in the world at 427,107 TEU. The company operates 74 international lines and 17 domestic lines, according to the China Daily.

CSCL's total assets amounted to CNY32.8 billion by the end of June this year. Its operational income was CNY17.46 billion and profit was CNY1.44 billion in the first six months.

Nov-27-2007