Securities regulators have given China CNR the go-ahead for its proposed 6.5 billion yuan ($1 billion) initial public offering for up to 34% of its equity. The company, which along with China South Locomotive & Rolling Stock (CSR), is one of the two leading railway engineering groups, plans to use the money to upgrade its production and technology capabilities to compete in the world’s fastest growing large railway market and in which the government is spending big to expand the high-speed inter-city network.
Regulators have been concerned that the recent wave of IPOs and proposed IPOs risked flooding a stock market that was showing signs of correcting after having risen 90% since the start of the year. China International Capital Corp (CICC), Huatai Securities and Huarong Securities will be the joint lead underwriters of the China CNR offering. China CNR’s shares will be listed on the Shanghai-A market. CSR is already listed in Shanghai and Hong Kong.