Sinotruk to reduce debt with listing proceeds

Sinotruk (Hong Kong) will lower its debt-equity ratio to 55 per cent from 82.2 per cent after its initial public offering this month.

'Our gearing will decline substantially after raising money from the stock market,' executive director and president Cai Dong said.

'The high gearing mainly stems from the company's restructuring in 2000, for which we shouldered all costs,' added chairman Ma Chunji.

Sinotruk will use HK$2.5 billion, or 28 per cent of the expected proceeds, to repay some of its debts.

Jinan-based Sinotruk will issue 702 million new shares to raise up to US$1.15 billion. The sale of the public tranche runs from today to next Tuesday.

The stock will begin trading on November 27.