In the past five years, east China’s Jiangsuprovince has stepped up its efforts for the promotion ofthe reform of mixed ownership through public listing in a bid to accelerate the pace of asset backed securitization with the provincial level enterprises. 50 state-owned enterprises in the province have issued their IPOs to ensure the preservation and increase of the value of the state-owned capital.
Jiangsu Guoxin Investment Group Limited celebrated its reshuffling and listing ceremony at Shenzhen Stock Exchange on April 19 this year to inject high quality assets through stock offering.
Guoxin, which grows from the merger of Sainty Shipbuilding, used to be the largest state-owned shipbuilder in the province.
Affected by industry downturn and business policy failures, the company has been subject to huge losses since 2014 and was on the brink of being delisted and liquidated for insolvency.
To save the crisis, Guoxin has resorted to the combination of bankruptcy plus restructuring and reshuffling of major assets to clear the debt and assets of Sainty and inject its core assets that include the power plant and trust equity into a "net shell". In this way, Guoxin has been able to liquidate its entire creditor clearances and arranged for its energy and finance businesses to go public in the shortest possible time.
The new listed companies have broadenedthe financing channels, invigorated the stock of state-owned assets, and boosted the credit group's asset backed securitization rate from 20% to 49%.
Since 2012, the state-owned enterprises in Jiangsu have accelerated their pace of going public on the stock market with Huatai Securities and Holly Futures issuing H-shares on the Hong Kong Stock Market to broaden the overseas financing channels.
The Bank of Jiangsu, a provincial commercial lender, has offered its initial public offering on the Shanghai stock market by raising more than 7 billion yuan, enabling the bank to replenish its coffers and increase its competitiveness.
A-shares are denominated in Chinese yuanand are traded on the Shanghai and Shenzhen stock exchanges. Only Chinese individuals and institutions can buy them.
Jingsheng Salt and Chemical Industry Co. Ltd has reduced shareholding ratio of state-owned shareholders from 77.06% before the IPO to 64.66%. Itsnet profit this year has increased by 24% year on year.
Over the past five years, the provincial level enterprises in Jiangsu have raised 39.6 billion yuan of private capital with their combined asset gaining an increase of 51.7 billion yuan.
