CIMH to use $582m IPO proceeds to boost capacity and grow market share China Infrastructure Machinery Holdings (CIMH) plans to use the bulk of the proceeds from its $582 million initial public offering in Hong Kong to expand its market share in the mainland. CIMH, the country's third-largest wheel loader manufacturer, launched its pre-listing roadshow early last week in Hong Kong, Singapore and Britain. The company is now headed for the United States, the last stop of its marketing effort. Sources say the offering received positive response in Singapore but the reception in other markets is unclear. The company initially offered 300 million new shares, of which 90 per cent will be an international placement and 10 per cent will be sold to the public in Hong Kong. The company is scheduled to list on November 3. Inventory levels have been relatively high in the past three years as the company tried to boost market share by offering equipment financing to selected customers. The firm said trade receivables and inventories, which contribute most to short-term liability, amounted to 602.4 million yuan on June 30. Chief executive Qiu Debo described the present inventory level as healthy amid sales rising to 1.5 billion yuan. Mr Qiu said the company also would demand customers pay at least 50 per cent of the deal in advance and the remaining within six months to control credit risks. 'Unless the deal has been fully paid, we are still in a leasing and financing relationship with our customers,' he said. CIMH is targeting a 16 per cent market share by the end of December and at least 20 per cent after the capacity expansion, compared with 14 per cent now. The company is planning to expand the annual production capacity of its core product range from 18,000 units next year to 26,000 in 2008. It makes three to five-tonne wheel loaders under the Longgong brand.