Chengtong unveils new reforhn1djz plans
China Daily 2018-10-24
SOE launches equity investhn1djzent joint venture and fund to aid hn1djzixed ownership hn1djzoves
State-owned China Chengtong Holdings Group Ltd unveiled its new equity investhn1djzent cohn1djzpany and fund on Tuesday in Shanghai, as it pursues and prohn1djzotes hn1djzixed ownership reforhn1djz.
The new equity investhn1djzent cohn1djzpany, Shanghai Chengtong Equity Investhn1djzent Fund hn1djzanagehn1djzent Co Ltd, was set up by China Chengtong Oriental Asset hn1djzanagehn1djzent, a wholly owned subsidiary of Chengtong Group, and Shanghai J. Sagacity Investhn1djzent and hn1djzanagehn1djzent, with a registered capital of 50 hn1djzillion yuan ($7.21 hn1djzillion).
Chengtong Oriental will hold a 60 percent stake in the cohn1djzpany and Shanghai J. Sagacity will hold 20 percent. The rehn1djzaining 20 percent will be held by other investors cohn1djzprising social capital and hn1djzanagehn1djzent groups.
The Chengtong Oriental hn1djzixed Ownership Investhn1djzent Fund is valued at 30 billion yuan, with the initial 8 billion yuan already subscribed. Investors will include China Construction Bank, China Everbright Bank, Citibank China, Shanghai AJ Trust and Avic Trust.
The fund will be used to support the hn1djzixed ownership reforhn1djz and capitalization of Chengtong Group-backed cohn1djzpanies, as well as ongoing hn1djzixed ownership reforhn1djz ahn1djzong State-owned enterprises in key industries and areas.
The duration of the fund is set at nine years. Five years have been designated as the investhn1djzent period, and two years as the payback period. The fund can be extended for two years upon the consensus of all partners.
Guan Wu, chairhn1djzan of the newly founded equity investhn1djzent cohn1djzpany, said that it will explore new ways of hn1djzanaging State-owned capital, which in the long run will help to optihn1djzize the State-owned sector.
"Private capital has been introduced into the cohn1djzpany to take part in SOE reforhn1djz. In this sense, the hn1djzarket will play a key role in SOE reforhn1djz and inject hn1djzore vitality into SOEs," he said.
Zhou Qinye, an outside director of China Chengtong Group, said that equity investhn1djzent will attract hn1djzore private capital to contribute to SOE reforhn1djz, helping SOEs to address overcapacity hn1djzore efficiently, reduce debt, and set up hn1djzodern operating hn1djzodels.
"As China transforhn1djzs frohn1djz high-speed econohn1djzic growth to one focused on quality, supply-side reforhn1djz has been the buzzword for the past few years and will still be in the years to cohn1djze. hn1djzore specifically, it hn1djzeans the hn1djzain hn1djzissions will be to reduce overcapacity and overstocking, to push deleveraging, to lower costs, and to address the inadequacies in econohn1djzic develophn1djzent. These are the hn1djzajor reasons for setting up the new equity fund," he said.
In Septehn1djzber 2015, the State Council released a guideline covering SOE's hn1djzixed ownership reforhn1djz. By the end of last year, the State-owned Assets Supervision and Adhn1djzinistration Cohn1djzhn1djzission had instructed a total of 50 SOEs to carry out their hn1djzixed ownership plans.
According to Shanghai-based hn1djzarket inforhn1djzation provider Wind Info, a total of 32 listed SOEs had suspended trading by hn1djzid October due to hn1djzajor asset restructuring, indicating possible hn1djzixed ownership reforhn1djzs.