Airport firm seeks revival through IPO
Liaoning Province Airport Management Group, which controls four airports in the northeastern province, is planning a Hong Kong flotation to raise funds to help turn around three facilities which are losing money.
The company is aiming to go public in the second half of next year, raising about $600 million through the listing of a restructured vehicle with assets of about 400 million yuan.
Vice-general manager Ma Huixian said the 'better quality' assets would be chosen for listing and would not include the profitable Taoxian airport. The other airports - all in the red - are in Shenyang, Dandong and Jinzhou.
'Taoxian is already a shareholding company; it can go public anytime,' Mr Ma said. 'But it will not be included in the restructuring.'
Airport managers nationwide are keen to tap stock markets for funds to increase efficiency after the central government returned management responsibility for most airports to local governments.
Previously, the General Administration for Civil Aviation of China (CAAC), which managed 131 airports across the country, saw annual losses of four billion yuan, Mr Ma said
Although the CAAC was no longer involved, the central government would still have to provide three billion yuan in subsidies to poorer airports over the next two years.
Liaoning Province Airport Management is one of scores of potential H-share candidates hoping to grab the attention of Hong Kong's stock investors at a listing conference yesterday organised by the State-owned Assets Supervision and Administration Commission and Hong Kong Exchanges and Clearing.
In the first seven months of this year, 280 companies, or 26 per cent of all listings in Hong Kong, were by mainland companies, according to the exchange.
However, mainland regulators have been in a dilemma over overseas listings. They are worried that better quality firms will go abroad, leaving the slumping domestic A-share markets with the weaker performers.
