SHANGHAI Dazhong Taxi Co says it has pulled off the first successful rights issue for B shares in the Shanghai market - a sharp contrast to Shanghai Vacuum's attempts to launch a rights issue last March.
The application period for the Dazhong issue, designed to raise 125 million yuan (about HK$170 million), ended on Friday.
Dazhong chairman and general manager Yang Guoping said: ''Nearly everybody has taken up their rights.'' The company had made available 22.5 million B shares - denominated in US dollars and sold only to foreign investors - to its investors - plus nine million yuan-denominated A shares for local players.
The offer was made barely a year after Dazhong's initial public offer and would almost double the company's capital base and the number of issued shares.
This could have left it open to criticisms of an overly hasty return to the market like Shanghai Vacuum, which suffered the unhappy experience of having to withdraw its first attempted rights issue offer in Shanghai's B share market.
However, unlike Shanghai Vacuum, Dazhong - Shanghai's second biggest taxi fleet operator - is proving to be highly popular with foreign investors.
It features at the top of many broker's buy recommendations. This probably accounts for Dazhong B-share prices rising by about 40 per cent in the past month.