Toll-road operator Jiangsu Expressway Co is set to increase rates 25 per cent on the Jiangsu section of National Highway 312 which it plans to acquire. The move is designed to divert traffic to the H-share company's Shanghai-Nanjing Expressway, which runs parallel to the Jiangsu highway, eliminating competition between the two. Jiangsu Expressway, which will raise up to $3.7 billion this month, will earmark 1.35 billion yuan (about HK$1.25 billion) to buy 15-year operating rights for the highway. Chairman Xu Huaqiang said: 'The aim of the purchase is to mitigate competition between the two roads.' He said the government had granted permission to raise toll rates at National Highway 312 after the company completed the acquisition at the end of this month. The national highway charges 60 yuan a trip for small vehicles, compared with 100 yuan by the Nanjing-Shanghai Expressway. The rate at the highway will be increased to 75 yuan a trip. Mr Xu said it was possible the company would acquire the Jiangyin Yangtze Bridge, which links the South and North Approach Expressways. The bridge and the two expressways would be completed in 1999. He said the company would only invest in or acquire projects that would generate an internal rate of return of at least 20 per cent. He said its acquisitions would be funded by further share issues. According to a preliminary prospectus, the company plans to issue 50 million A shares in Shanghai six months after the completion of the H-share offer.