Beijing Enterprises lines up asset-buying spree
Infrastructure company Beijing Enterprises Holdings is planning to acquire more gas and water treatment projects this year to take advantage of low asset valuations.
The company did not disclose a budget for the acquisitions but said 60 per cent would go to gas projects and the rest, waste-water treatment assets. Top executives said yesterday the group would also spend 3.5 billion yuan (HK$3.97 billion) to 4 billion yuan this year.
'Assets other than those owned by the parent company will be our targets this year, as asset prices are relatively low,' said vice-chairman and chief executive Zhang Honghai.
Chairman Yi Xiqun said it was possible the company would buy assets from its parent to develop green technology, but would wait until the technology matured.
The company said it had sufficient internal resources to fund the planned acquisitions.
Beijing Enterprises has about HK$8 billion cash on hand after it issued HK$2.18 billion worth of convertible bonds last month.
'We chose to raise capital at that time because of the low financial costs,' said Mr Yi.
He said Beijing Enterprises' focus at the moment on the development of utilities was a defensive strategy amid the economic downturn.
For last year, the strong performance of its piped-gas operations lifted the company's profit from continuing operations 96.79 per cent to HK$1.96 billion.
Beijing Enterprises said its shareholders would not be affected by the new dividend income tax levied on non-resident enterprises.
Shares of the firm closed 0.75 per cent down at HK$33 yesterday. The stock has risen only 4.59 per cent so far this year.
