AS the first stage of a fund-raising programme, China arms-maker China North Industries Group (Norinco) has established a direct investment fund which will begin trading in Singapore and Dublin on Tuesday.
The Singapore listing will make it the first China fund to be quoted there and the exchange in the Lion City is discussing a memorandum of understanding with the China Securities Regulatory Commission.
The closed-end fund, China North Industries Investment, has raised US$185 million in a private placement with a 2.5 times subscription. The proceeds will be used to invest in 18 pre-selected joint ventures with Norinco, covering three industries - automotive, construction and optical products.
'They are the best companies in those industries and those industries are strategically important to China's development,' said Regis Dale of H G Asia, the global co-ordinator.
Li Meng, deputy head of Norinco's planning and development department, said the group hoped to absorb more foreign funding.
Norinco reportedly aims to raise $500 million for development.
China North has already earmarked $160 million for the 18 joint ventures. The automotive industry projects account for more than half of the funds.