WHEELOCK and Company chairman Peter Woo Kwong-ching is on the acquisition trail, following the group's recent purchase of a 25 per cent stake in the package printing firm Climax International. Company chairman Peter Woo Kwong-ching told Sunday Money his firm hoped to tap into the marketing and services sector on the mainland. Benefiting from a low-cost manufacturing base in China, the target companies would produce goods with both strong domestic and export potential, he said. Stock analysts suggested the Climax deal, done through Wheelock Pacific, showed the group's interest in building a large equity portfolio similar to what Cheung Kong has been doing over the last few years. Mr Woo, however, said that Wheelock was pursuing a strategy in which the new acquisitions would add value to the group's marketing network on the mainland and in the Asian region. He said:''Wheelock is business orientated rather than share market operations orientated. The group focuses on partnership and is not investing to make money from the shares but from the growth of the business.'' Wheelock reported a 61.1 per cent jump in interim profit to $940.3 million last week, which was at the upper end of analysts' expectations. The strong growth came on the back of a 44 per cent earnings rise from Wharf, but the Wheelock subsidiaries have also shown respectable returns. Anticipating a narrowing of the gap which still separates Wheelock and Wharf, Mr Woo said the dependency of Wheelock's earnings on Wharf would diminish from a current 70 per cent to about 60 per cent in the next few years. Peter Woo's intention of positioning Wheelock as a dynamic hong providing a separate play on the market to Wharf is a bid which he hopes will yield a corporate twosome in the Jardine-Hongkong Land mould. As to the group's future financing arrangements, he anticipated the series of capital-intensive projects Wharf, in particular, had on its books would lead to a maximum gearing ratio of 30 per cent, up from the current level of 10 per cent. Beyond that upper limit he considered the group would be overly exposed to what he euphemistically described as ''any adjustment process that may take place in China''. Speaking enthusiastically of the rapidly evolving market in corporate paper, he refused to speculate if the company would be tapping the market for further debt financing in the short-term, although he said: ''If we do decide to move, we will be thoroughly prepared and do so extremely quickly.'' On the other big development in the Wharf-Wheelock stable, Mr Woo had some strong words on the regulatory structure that is being negotiated for the second telecoms network. ''The regulatory regime will be all important if the new players are to be more than just fluff,'' he said. Comparing Wharf's situation to the plight of Britain's second carrier Mercury he said: ''We should take what Mercury is asking for (from British Telecom) and fight for more.'' Playing down the competitive threat to Hongkong Telecom, he said: ''They want you to believe that the three [Wharf, New World and Hutchison] are tough competition but they have the competition, the long distance monopoly. They've got all the cards in their favour.'' On the infrastructure projects in China, Mr Woo said that Wharf was at the final stage in setting the terms for the port project in Wuhan. ''Most of the feasibility studies have been completed and agreements are expected to be signed next year,'' he said. Wharf has been very prudent in its mainland infrastructure investment given the huge demand for capital and the group's limited resources, he said. ''The group cannot be greedy in such investments and the mainland investors are also taking such view,'' he said. Mr Woo also stressed the synergies between the infrastructure projects and property development undertaken by Wharf and the trading/retailing operations of Wheelock. With a significant portion of the properties built in China retained for long-term holding, trading and retailing, business could be better developed, he said. Meanwhile, he denied reports from analysts that a significant percentage of Wheelock's interim profit growth came from US treasury bond operations. Discounting the contributions from the three main quoted entities, Wharf, Hong Kong Realty and Lane Crawford, the non-quoted operations provided a net contribution of roughly $85 million. Mr Woo said that the treasury operations did not constitute a significant contribution to profit. It was simply a method of making highly liquid investments with short-term cash that the group was holding, he added. Analysts predicted an improved profit contribution from Wheelock Properties in the second half. Completion of Parc Oasis phase four and sales of Wing On House 10th and 11th floors provided the bulk of property development results, analysts said.