Citic Pacific keen to lead red chips' return to mainland bourses

Hong Kong-listed Citic Pacific remains keen to lead the wave of red chips that are poised to list their shares on the mainland once Beijing approves such a homecoming, according to managing director Henry Fan Hung-ling.

Red chips are mainland companies incorporated and listed in Hong Kong, with Chinese controlling shareholders. Beijing authorities last year said they were considering whether to allow red chips such as Citic Pacific, China Mobile, CNOOC, Lenovo Group and China Netcom Group to list on mainland markets.

Citic Pacific chairman Larry Yung Chi-kin welcomed the prospect at the time, saying the firm was hoping to list in Shanghai or Shenzhen as soon as regulations permitted it.

'We are still waiting for the mainland authorities to issue the policies regarding how and when the red chips will be allowed to go back to list in the mainland A-share market,' Mr Fan said in an exclusive interview last week.

The domestic capital raising would finance the group's expansion in mainland property and special steel manufacturing projects, he said.

Hopes that the clearance would come last month were dashed when Beijing put the listing plan on hold and sources said the State Council had suspended the plan for fear it would further hurt the weak Shanghai market which has fallen 50 per cent from its peak in October last year.

The mainland's initial proposal to list the red chips at home led the Hong Kong government to lobby against the plan in the middle of last year, as it was worried the move would hurt sentiment towards the Hong Kong market.