The mainland government has backed Yue Da Holdings' plans to raise a net HK$36.2 million from a mainboard, red-chip listing to acquire a bridge in Chongqing.
The listing is the latest move by authorities to raise funds in Hong Kong for infrastructure construction.
Yue Da will sell 60 million new shares at between 84 HK cents and 90 HK cents each in the initial public offering, representing 30 per cent of the company's enlarged share capital. The offering involves 54 million shares for private placement and six million shares for public sale.
Yue Da will use HK$35 million of the proceeds to acquire a stake in the Niujiaotuo multi-lane bridge spanning the Jialingjiang River in Chongqing. The balance will be used as working capital.
Chairman Hu Youlin said the bridge was an important traffic link and would offer a higher return than average toll roads.
'We want to buy the bridge because there is a great growth potential in the city's economy,' Mr Hu said.
Chongqing was 'split' from Sichuan province and brought under the direct jurisdiction of the central government in 1998. It is designated as a growth engine of the western region.