London Stock Markets Encourage China’s Smaller Firms

Photo By London Stock Exchange

LONDON has become a gateway to Europe for China’s businesses with about 400 Chinese companies investing in the United Kingdom, and with many choosing the capital to host their European headquarters.

China’s economy has gone from strength to strength in recent years. It reported annual growth of 11.9 per cent in the second quarter of 2007, the fastest pace in nearly 12 years. It also has the world’s biggest foreign exchange reserves, worth 1.3 trillion US dollars and growing by one million dollars a minute.

With plans to encourage more inward investment from this rapidly expanding economy, the London Stock Exchange (LSE) is aiming to set up an office in Beijing to encourage more small and medium-size Chinese companies to list on the Alternative Investment Market, the LSE’s junior market.

There are currently six Chinese companies listed on the main stock market, including Zhejiang Southeast Electric Power, Jiangxi Copper and China’s flagship airline, Air China.

In December 2004, Air China listed on the LSE as well as on its own domestic market in Hong Kong. The public offering was aimed at raising about one billion US dollars on the two markets.

Clara Furse, the LSE’s chief executive, said: “We are delighted that Air China has chosen London for its listing outside of China. The London Stock Exchange offers ambitious Chinese companies access to the world’s most international equity market combined with high regulatory and corporate governance standards.”

Air China was able to use a single prospectus for its listings in London and Hong Kong because of the similar regulatory environments in the two financial centres.

Martin Graham, the LSE’s director of market services, said: “Air China’s ability to list in Hong Kong and London using a single prospectus offers a blueprint for other Chinese companies seeking to list overseas and raise international investment capital. We anticipate further companies following their lead.”

Meanwhile, the Alternative Investment Market (AIM) allows smaller companies to float shares on a more flexible regulatory system than that of the main market. There are more than 1,600 firms listed on the AIM; 58 are from China.

An LSE spokesman said: “There is a strong flow of small and medium-size enterprises from China coming to list on the AIM. The office in Beijing will help this process.”

This is not the LSE’s only foray into South-East Asia. It has recently been in talks with Vietnam’s stock exchanges, looking for an agreement to enable London to compete for listings of the country’s biggest government-owned companies.

Henry Chiu, manager of the LSE’s Hong Kong office, said: “Investors on the AIM enjoy several preferential tax policies from the government. This helps them attract a considerable amount of capital and remain stable on the AIM.”

Mr Chiu continued: “After being publicly traded on the domestic market, a lot of mainland Chinese firms currently also choose to float on the Hong Kong stock exchange. We hope in the near future that the mainland-listed firms will go directly to London for dual listing.”

Earlier this year (May 2007), a UK delegation made up of government representatives, market brokers and lawyers went to Beijing to encourage high-growth small and medium-size Chinese firms to list on the UK market. During their trip, the delegation hosted a national conference called, Raising Finance & Investing In The UK. The profile of London as the place to list and source advice and finance for Chinese business has also been raised over the last two years through a programme of seminars and workshops under the “Going Global” brand. These events fronted by the Lord Mayor of the City of London, John Stuttard, and organised by the China Britain Business Council with support from UK Trade & Investment have attracted huge interest and are set to continue during the Lord Mayor’s visit to Beijing, Shanghai, Nanjing in October. The website www.going-global.biz links Chinese entrepreneurs with UK partners.

Lin Wenrun, who works at a medium-size firm selling car decoration materials in south-east China’s Fujian province, went to Beijing to attend the conference. He s aid: “We are planning to float our stock on the market because our business has been growing very fast in recent years, so we are here to see what we can get from a UK listing.”

One company that has already taken the plunge is China Shoto that listed on the AIM in 2005. The firm is one of China’s leading companies responsible for the design, development, manufacture and sale of industrial batteries and power supply systems. It is mainly involved in the production of rechargeable lead-acid batteries that are sold as individual units or as battery systems for a range of industrial applications. It also supplies related products such as chargers, power equipment and battery accessories.

China Shoto is a leading supplier to major Chinese firms such as China Telecom, China Mobile, China Unicom, China Netcom and China Tietong. In December 2005, following the successful placing of more than 4,615,000 new ordinary shares at 130 pence each, the company raised six million pounds sterling in gross proceeds from the placing, giving a market capitalisation on admission to the AIM of 26m pounds.

According to Mr Cao Guifa, chairman of China Shoto, the listing was a natural step in the company’s development. He said: “We are very pleased with the positive response to China Shoto’s initial public offering. We now look forward to using the funds raised from the flotation to take China Shoto to the next stage of growth and to continue to build on the success of our already strong brand and reputation.

He continued: “The funds raised will allow us to increase our penetration of our domestic market and to expand sales overseas. We now look forward to working with our new institutional shareholders and taking the group to the next stage of its development.”

Strong future business links between the UK and China have been further cemented by a five-year agreement between Ken Livingstone, the Mayor of London, and Wang Qishan, the Mayor of Beijing.

The agreement - signed in Beijing in April 2006 - reflects the joint commitment of the two mayors to work together to encourage business links, trade links, tourism, educational exchanges and cultural relations between the two capitals that will benefit both cities.

The mayors also want to encourage cooperation ahead of the 2008 Olympic Games in Beijing, and the 2012 Olympic Games in London. The games will provide additional opportunities to further strengthen relations between London and China.

Mr Livingstone said: “With Beijing at the heart of China - the world’s fastest growing economy - and London, a world leader in financial and business services, we are confident that both our great cities can benefit from closer ties.”

Flying high: China’s flagship airline, Air China, is one of six companies listed on the London Stock Exchange. The LSE expects to set up office in Beijing to attract more small/medium-size Chinese firms to list on the Alternative Investment Market (AIM), the LSE’s junior market. There are 58 Chinese firms listed on the AIM and the LSE seeks to encourage more to follow.

伦敦证券市场鼓励中国小型企业融资

图片提供：伦敦证券交易所

伦敦已经成为中国企业进入欧盟市场的门户，目前大约有400家中国企业选择在英国投资，而其中绝大多数企业又将伦敦作为他们在欧洲的总部。

近年来，中国经济的发展日新月异。报告数据显示，2007年第二季度中国经济的年增长率为11.9％，是近12年来增长速度最快的一次。同年，中国的外汇储备也跃居全球第一，达到1万3千亿美元――每分钟以100亿美元的速度增长。

为了从经济迅猛发展的中国市场吸引更多的对内投资，伦敦证券交易所计划在北京建立一个办事处，以鼓励更多的中国中小型企业在二板市场上市。

迄今为止，已经有六家大的中国公司在伦敦证券交易所的主板上市，其中包括浙江东南发电股份有限公司、江西铜业集团公司、中国的旗舰航空公司――中国国际航空。

2004年12月，中国国际航空股份有限公司同时在伦敦证券交易所和中国本土市场香港成功上市。首发新股，国航预计在两方市场上筹集大约10亿美元的资金。

伦敦证券交易所的首席执行官高磊雅（Clara Furse）女士说：“很高兴中国国际航空选择伦敦作为它在海外的投资市场。伦敦证交所为雄心勃勃的中国企业提供了一个通往欧洲市场的理想门户，它运作世界上国际性最强的股票市场，有着严格的调控机制和统一的管理标准。”

中国国际航空之所以可以使用一份招股书实现在伦敦、香港两地上市，是因为这两个金融中心制度环境大体相当。

伦敦证券交易所的创业板总裁高睿谋（Martin Graham）表示：“中国国际航空以一份招股书实现两地上市的先例为其他打算在海外上市、吸引国际投资资本的中国企业提供了一个蓝本。我希望有更多的中国公司能效仿这一创举。”

与此同时，伦敦的二板市场允许小型企业以比主体市场更为灵活的运作规则发股。目前，伦敦二板市场上的上市企业有1，600多家，其中有58家中国企业。

伦敦证券交易所的一位发言人称：“中国的中小型企业在伦敦的二板市场上市已经呈现出强劲的趋势。伦敦证交所在北京设立办事处，无疑将会推动这一趋势。”

为了鼓励对内投资，在海外市场建立办事处已经不是伦敦证券交易所在东南亚地区采取的唯一行动了。近来，伦敦证交所正在与越南方面的证券交易所进行磋商，希望就允许伦敦与当地众多大型政府机构竞争成为上市公司达成一份协议。

伦敦证券交易所香港办事处经理赵勇杰（Henry Chiu）说：“二板市场的投资者非常赞赏政府的优惠税收政策，不仅帮助他们吸引了大批数量可观的资本，而且使他们在二板市场上保持稳定的发展态势。”

他还说：“通过利用国内市场上的宣传力度，很多中国大陆的企业近来也选择在香港证券交易所发行证券。我们希望，在不久的将来，中国大陆的上市公司将直接到伦敦融资，实现双边上市。”

今年早些时候（2007年3月），一个由政府代表、证券市场经纪人和律师组成的英国代表团赴北京访问，旨在鼓励那些发展较快的中国中小型企业去英国上市融资。期间，英方的代表们主持召开了“中国企业在英国上市融资及收购兼并高峰论坛”。过去两年，中国政府为了配合和指导“走出去”战略的实施做了很多工作，召开研讨会，建立工作小组，从而使伦敦成为中国企业上市融资目的地的形象得到了提升。这项工作是在英国贸易与投资总署的支持下，由伦敦金融城市长约翰•史达德（John Stuttard）牵头，中英商会组织主办的，引起了业界的极大兴趣，并计划在10月份伦敦金融城市长访问北京、上海、南京的时候将此继续贯彻实施。网站www.going-global.biz链接了相关的中国企业及其英方合作伙伴。

就职于华东福建省一家销售汽车装饰材料的中型企业的林温润（Lin Wenrun）五月份去北京参加了大会。他说：“我们的企业最近几年发展很快，现在我们正打算在伦敦市场上发行自己的股票，所以我们想知道股票在英国上市融资以后，我们会得到哪些优惠。”

双登集团就是这样一个企业。经过不懈的努力，该企业终于于2005年在英国伦敦证券交易所二板市场挂牌上市。双登集团是中国国内电池、能源供应系统重要的研发、生产和销售基地。主要产品是铅酸蓄电池，可以零售，也可以大批量用于工业生产，此外，还生产其他相关产品如充电器、动力设备和电池零配件。

双登集团是中国电信、中国移动、中国联通、中国网通和中国铁通等大型企业的主要供应商。2005年12月，该集团以130便士的发行价发行4,615,000多只普通股，获准进入二板市场的公司市值为2600万英镑，筹取净利600万英镑。

双登集团的董事长曹桂发认为，公司在海外上市是企业发展的必然。他说：“双登首发股的成功使我们倍感兴奋。我们希望用这笔筹金将双登带入下一个阶段的发展，并继续树立强大的品牌效应和荣誉，续写企业的成功！我们要在加强对国内市场渗透的同时，还要拓展海外市场，我们希望与新的机构股东一起，引领集团步入下一个阶段的发展。”

北京市市长王岐山和伦敦市市长肯•利文斯通签订的为期五年的友好城市合作协议进一步夯实了中英双边贸易联系。

这一协议于2006年4月在北京签订，双方表示将携手合作，共同推进两个城市之间实现互利双赢的中英贸易、商务、旅游、教育以及文化事业的交流与传播。

两位市长鼓励双边合作，2008年北京奥运会以及2012年伦敦奥运会的举办，将对进一步促进中国与伦敦的关系是一个良好的契机。

利文斯通表示：“北京是世界上经济增长最迅速的国家的首都，而伦敦是世界上金融与商贸服务领域的领先者，相信两座城市将会从加强联系中获益。”

后记：中国的旗舰航空公司――中国国际航空公司是在伦敦证券交易所主板上市的六大企业之一。为了吸引更多的中国中小型企业在二板市场挂牌融资，伦敦证券交易所计划在北京设立办事处。目前伦敦证交所的二板市场上已经有58家中国企业，伦敦证券交易所期待更多的中国企业加盟。