Guangdong China Sunshine Media has received approval from the securities regulator to float its shares on the Shanghai Stock Exchange, becoming the mainland's first company traded on the over-the-counter market to go public.
The firm, a subsidiary of Guangzhou Daily, a prominent mainland newspaper, handles advertising, printing and newspaper sales. It will make an initial public offering of 70 million shares and use the proceeds to fund 375 million yuan worth of expansion projects.
Sunshine Media closed at 20.90 yuan on the OTC market last Wednesday before it suspended trading to go through the regulatory review. It said it would place 50 million shares to existing stakeholders and the remaining 20 million to individual investors.
It has not set a price range for the offering and will not start price consultations until it receives another approval from the China Securities Regulatory Commission for that purpose.
The stock offer may bode well for companies traded on the country's OTC market - originally set for delisted firms - as the watchdog widens access for cash-hungry firms to stock funds, analysts said.
'The market is flush with funds,' said China Citic Securities analyst Cheng Weiqing. 'Regulators have reason to speed up share sales.'
Mainland companies raised a combined 225 billion yuan on the stock market last year after the share-sale ban was lifted in May. The bull run continued to the first half this year with 300 billion yuan being raised in the market.