Merger on track as train firms’ trade halted
Print Edition
SHARES of China’s top state-owned trainmakers China CNR Corp and CSR Corp were suspended from trading yesterday, opening the process toward merging them to create possibly the world’s biggest rail company.
The two companies said in stock exchange filings that the suspension would last until the merger is completed. But they gave no specific date.
According to the merger deal, CSR will issue shares to CNR’s shareholders under a swap ratio of one CNR share for 1.1 CSR share. CNR will delist from stock markets in Shanghai and Hong Kong.
The trading halt will give current shareholders of both companies the opportunity to exercise options to sell their shares that were offered when the deal was first announced at the end of last year.
The shares of CNR closed at 29.98 yuan (US$4.83) in Shanghai on Wednesday, while CSR closed at 29.45 yuan.
The merger, which aims to create a rail giant able to compete with global rivals, may result in the birth of China Railway Rolling Stock Corp, according to Reuters.
The two rivals are already the world’s largest train suppliers by sales. They currently have a combine market capitalization of US$113 billion.
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