Mainland Chinese Company Set To List In Taiwan

In a historic first, a Mainland Chinese company

, Yangzijiang Shipbuilding, Chinas fourth largest shipbuilding company based in Jiangsu Province, is seeking to list on the Taiwan stock exchange.

This would be the first Mainland Chinese company to do so, in a remarkable turn around of fortunes since the island became politically divided from China after the conclusion of the Chinese Civil War in 1949.

Yangzijiang is seeking to raise about US$116 million from a listing due on September 8th, according to the Taiwan Stock Exchange. Taiwan has been seeking overseas investment for the past two years, though until now, the bourse has been largely limited to Taiwanese companies seeking to raise local funds to expand overseas.

Political relations between Taiwan and Mainland China have improved significantly over the past year, and the listing of a Mainland Chinese business in Taiwan would further increase the stability of relations between the two sides. Other China red chips usually Mainland Chinese state-owned enterprises listed on overseas markets such as Hong Kong, Singapore and elsewhere have also expressed interest.

While the Yangzijiang listing is relatively small, the fact that it is happening at all in Taiwan is real news as it relates to the political implications and development. Yangzijiang stocks are already traded in Singapore, and the company has become one of the benchmarks of the Straits Times Index on the Singapore Exchange.

The companys assets include an area along the Yangtze of 2.2 million square meters and a wharf line of 3,000 meters. Yangzijiang also employs over 10,000 personnel. Equipped with a large dry dock and five large and medium-sized slipways, the company boasts a shipbuilding capacity of over 1 million DWT annually in terms of ship tonnage. The companys main products range from large and medium-sized container-ships to large bulk carriers and medium multi-purpose ships.

Yangzijiang already supplies ships to the major carriers in China, Taiwan, Singapore and elsewhere in Asia, and the listing of their stock in regional markets makes sense in securing shipbuilding facilities.

by: Dezan Shira & Associates

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