Officials from the Chinese State- owned Assets Supervision and Administration Commission (SASAC) Tuesday further explained some hot topics concerning M&A (merger and acquisition) and SOE (state-owned enterprise) reform in China.

Li Rongrong, director of SASAC, told a press conference in Beijing that to ensure SOEs have a good performance is the precondition for the transfer of state-owned shares.

"The number one difficulty in providing liquidity to state- owned shares is that every shareholder wants to profit somewhat without incurring any loss," said Li.

Li said the SASAC is trying to seek a solution for the transfer of state shares, and the basis for the solution is for the state- owned enterprises to perform well and to provide a relatively high return on investment.

Li stressed that state shares decrease and transfer are two different concepts. The decrease of the state shares is still going on in China, such as the recently announced sale of 20 percent stake from China's biggest film company, Lucky Film Co. to US photographic film giant Eastman Kodak.

No matter the decrease or the transfer of state shares, the basic point is equal treatment to all investors, said Li, adding that the SASAC is making joint efforts with the China Securities Regulatory Commission (CSRC) to promote regular and healthy operation in China's stock market.

Upon the active MBO (management buyout) in China, Huang Shuhe, vice-director of SASAC, said the Chinese government is preparing to issue laws and rules to regulate MBO operation.

He noted that all MBO cases in China should operate on the basis of credibility so as to prevent the loss of state assets and create equal opportunities for all investors.

According to Li, the future M&As in China will be in competitive industries.

Li said SASAC will issue a series of policies to support more foreign capital into the labor-intense industries, to increase foreign investment to medium and small companies, and to help foreign investment transfer from processing industries to tertiary industry.

At the same time, China will also further open other industries including transportation, communications, construction, health and medicine, law service, accounting, and consultancy, said Li.

Li said China will finish the establishment of provincial level SASACs by the end of this year. Currently, nine Chinese provinces, municipalities and autonomous regions have set up local SASACs, and 11 more are also ready to do so.

Li also said that in the future, more SOEs in China will select their senior managers from the worldwide scope, a marked step in China's personnel reform. The open recruitment in China's SOEs for worldwide talents will be further sped up, said Li.

Close

Today's Top News		Top Business News
+US opposes 27.5% tariff on China-made goods ( 2003-11-11) +Six-party talks may open next month ( 2003-11-11) +Six-party talks may open next month ( 2003-11-11) +Chinese embassy in Burundi hit by mortar shell ( 2003-11-11) +Official's death at golf course raises graft issue ( 2003-11-11)		+Officials on China's M&A, SOE reform ( 2003-11-11) +China urged to improve agricultural produce markets ( 2003-11-11) +China to have state standard on housing quality assessment ( 2003-11-11) +Aviation industry to witness rapid development ( 2003-11-11) +Company wins award for best corporate governance ( 2003-11-11)