legal news---China prepares foreign listings


More than 30 Chinese companies are preparing to sell and list shares on Germany's stock exchange, as overseas competition for Chinese listing candidates heats up, the Shanghai Securities News said on Friday.

Two to three of the Chinese firms, including Shandong Gongyou Group, a machinery manufacturer based in the eastern province of Shandong, are expected to list in Germany in the first half of next year, the newspaper said.

The companies are mainly involved in the auto parts, new energy, telecoms, consumer electronics, media, e-commerce and other technology sectors, Alexander Graf von Preysing, an official at Deutsche Boerse, told the newspaper in an interview.

"Listing in Germany will provide those companies planning mergers and acquisition s in Europe the access to euro financing," Preysing was quoted as saying, adding that Germany's listing costs are "relatively low."

Officials of overseas stock exchanges, such as those in Seoul and Singapore, have made frequent visits to China to woo listing candidates as foreign interest in Chinese equities rises, fueled by China's break-neck economic growth.

More than 100 Chinese firms have listed in Singapore. The Korea stock exchange has been knocking on the doors of many Shandong-based enterprises in the past year, Korean securities sources and a Chinese investment banker told Reuters.

Hong Kong is increasing efforts to lure more privately-owned Chinese companies in the booming southeastern Chinese province of Zhejiang .

Chinese securities officials have recently expressed concerns about the potential massive loss of Chinese companies to foreign bourses, urging local exchanges to take measures to beef up their competitiveness.

"The competition for market resources is sharpening in Asia and the world's capital markets," Tu Guangshao, vice chairman of the China Securities Regulatory Commission , told a seminar in Shanghai this month. #p#分页标题#e#

"Our stock market is flushed with liquidity and the situation will remain the same for the next few years. We must seize the great opportunity to develop our market," Tu said.

Most of China's some 1,400 listed companies are controlled by the state. Private companies remain largely shut out of mainland bourses in Shanghai and Shenzhen.

Many small and medium-sized, non-state Chinese companies have found their way into the stock markets in London, the United States and Singapore.

Beijing is encouraging major domestic state-run companies to return to mainland bourses to sell shares. Many of the companies have already listed in Hong Kong -- so far the dominant overseas fund-raising venue for mainland Chinese firms.

The Shanghai Securities News said in a report on Thursday that about 10 large Chinese companies were expected to sell shares in China in 2007, raising between 100 billion yuan ($13 billion) and 150 billion yuan.

Between May this year -- when China lifted a one-year ban on new listings -- and October, 36 companies raised roughly 100 billion yuan from the A-share market -- most of which was by companies with shares listed in Hong Kong.