Exchanges crack down on firms that fail to carry out reform of state shares
China Southern Airlines, the largest mainland carrier by fleet size, faces tighter trading limits on its China-traded shares from Monday as exchanges act against firms that have failed to begin share reforms.
As of January 8, the 18 Shanghai-listed and 22 Shenzhen-traded companies that have not started share restructuring ordered by the government will be allowed to trade only within a 5 per cent range from the previous trading day, down from 10 per cent.
Mainland-listed firms with state-owned shares have to give incentives in the form of shares, warrants or cash offering to get individual shareholders' approval to make the state-held shares tradable.
China Southern Air Holding, which owns 50.3 per cent of the carrier, said it had not yet found a way to carry out the reforms.
It has little room to reduce its holding since China Southern is a state-controlled air transport company, recommended by the Civil Aviation Administration of China.