BOC zips to buy railway stake
By Zhang Fengming |
April 2, 2010, Friday
|
Print Edition
Print Edition
THE Bank of China will invest 6 billion yuan (US$878 million) for a stake in a high-speed railway linking Shanghai and Beijing.
The bank's Hong Kong-based subsidiary, Bank of China Group Investment, has agreed to buy a 4.5 percent state in Beijing-Shanghai High-speed Railway Co, the third biggest bank in China in terms of market value said yesterday in a statement to the Shanghai Stock Exchange.
"The investment can generate reasonable returns for the bank and help the bank diversify its business," the Beijing-based bank said. "The bank can tap opportunities to ride on China's expanding railways through the deal."
BOC's subsidiary is buying the stake from the railway ministry-owned China Railway Investment Corp, the biggest shareholder of the high-speed rail company.
China Railway Investment said in March that it plans to sell the stake to raise more funds for future construction.
The deal is pending approval from the National Development and Reform Commission, the Ministry of Commerce and other related regulators.
Construction of the 220.9 billion yuan, 1,319-kilometer Beijing-Shanghai high-speed railway started in April 2008 and is due to be completed in five years. Last year China finished two high-speed railway lines between Wuhan-Guangzhou and Zhengzhou-Xi'an, with trains zooming at 350km per hour.
China's operational high-speed railways have exceeded 3,300km, and it leads the world in both the length of its railway and technology, the Ministry of Railways said in February.
The bank's Hong Kong-based subsidiary, Bank of China Group Investment, has agreed to buy a 4.5 percent state in Beijing-Shanghai High-speed Railway Co, the third biggest bank in China in terms of market value said yesterday in a statement to the Shanghai Stock Exchange.
"The investment can generate reasonable returns for the bank and help the bank diversify its business," the Beijing-based bank said. "The bank can tap opportunities to ride on China's expanding railways through the deal."
BOC's subsidiary is buying the stake from the railway ministry-owned China Railway Investment Corp, the biggest shareholder of the high-speed rail company.
China Railway Investment said in March that it plans to sell the stake to raise more funds for future construction.
The deal is pending approval from the National Development and Reform Commission, the Ministry of Commerce and other related regulators.
Construction of the 220.9 billion yuan, 1,319-kilometer Beijing-Shanghai high-speed railway started in April 2008 and is due to be completed in five years. Last year China finished two high-speed railway lines between Wuhan-Guangzhou and Zhengzhou-Xi'an, with trains zooming at 350km per hour.
China's operational high-speed railways have exceeded 3,300km, and it leads the world in both the length of its railway and technology, the Ministry of Railways said in February.
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