CHINA has allowed its largest car-maker to seek an overseas listing, because the Ministry of Machinery Industry wants to float more cash-strapped state-owned enterprises to raise funds.
However, the ministry will also make use of joint ventures and investment funds to satisfy the funding needs of enterprises under its control.
Xing Yujiu, director of the ministry's policy regulation and structure reform bureau, said Changchun's First Automobile Group Corp had secured an approval for issuing shares abroad, hoping to raise about US$500 million.
The company has yet to decide where it will be listed, but Mr Xing ruled out Singapore, which was more appropriate for light industry companies, saying that the company would opt for an international capital market with wider participation of institutional investors.
It is expected that First Automobile, known for its Liberation trucks, will raise money to fund expansion of its production capacity for passenger cars in a bid to meet China's expected boomimg demand as living standards improve.
The company is making Audi sedans and will also produce Jieda and Golf sedans through a joint venture with Germany's Volkswagen which will be completed in 1996.