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Gold/Mining/Energy : A to Z Junior Mining Research Site -- Ignore unavailable to you. Want to Upgrade?

To: 4figureau who wrote (3473)	2/27/2003 9:31:01 AM
From: 4figureau	Read Replies (1) \| Respond to of 5423

China gold firm says plans industry's first IPO Thu February 27, 2003 03:31 AM ET SHANGHAI, Feb 27 (Reuters) - China's gold market reform advanced a step on Thursday after a major state-owned gold producer said it plans to raise up to 700 million yuan ($85 million) in an initial public offering by as early as May. The IPO by Zhongjin Gold Co Ltd, 89 percent owned by top Chinese gold firm National Gold Corp, would mark the first time China had allowed the public to invest in a gold firm, developing the industry by helping it become more market-oriented. China is pushing cautious reforms in its precious metals industry, trying to boost transparency and move closer in line with global markets. Equity markets could serve as an important source of funding for China's gold firms, Zhongjin Gold spokesman Li Yueqing said. "China's stock market does not have a listed company with a core business in gold, so we hope we can debut as quickly as possible," Li told Reuters by telephone, adding an IPO date could be set for May at the earliest. "Raising money from the stock market opens a new financing channel for gold companies. As a result, our company's listing will also help the development of the whole industry," he said. China launched its first gold exchange in Shanghai in October, opening up a market over which the central bank used to maintain overwhelming control by fixing prices and acting as the sole intermediary between domestic gold buyers and sellers. China, one of the world's top five gold producers, aims to produce between 190 to 200 tonnes of gold this year, up from a record 189.8 tonnes tonnes in 2002. Zhongjin Gold, which mines, smelts and processes gold, was aiming for an IPO of 100 million yuan-denominated A shares in Shanghai, with proceeds to be used for expansion. Galaxy Securities, China's second largest brokerage by paid-in capital, was appointed the lead underwriter. "Optimistically, we hope to raise 600 million to 700 million yuan, but it depends on market conditions," Li said. The company, which can produce around 10 tonnes of gold a year, has total assets of more than 700 million yuan. It has posted earnings of between 50 million and 60 million yuan over the past three years since it was established in 2000, Li said. Officials say the central bank will halt direct purchases and sales of gold eventually, but offer no specific timeframe. reuters.com