Shenyang Public Utility

cancelled

In December 1999, China's state-owned public utility group Shenyang Public Utility Holdings Co Ltd (SPU), sold 400 million H-shares (40% of the company) in an initial public offering at the Hong Kong stock exchange. The shares debuted at HK$1.70 each as the 30.1 million shares it earmarked for public subscription in Hong Kong were 32.5 times subscribed. Another 270.9 million shares were offered for placement. Of those, about 99 million shares (9.9%) were subscribed by strategic investor Sino-French Water Development Co Ltd, a 50-50 joint venture between Suez water subsidiary Ondeo and New World Infrastructure of Hong Kong. Liaoning province-based SPU supplied purified water, operated long-distance bus services and held a 20% stake in the largest power plant in Shenyang, a city with a population of 6.73 million in 2004. SPU owned and ran seven water purifying plants in Shenyang through its 99%-owned subsidiary Shenyang Water. In 1998, Shenyang Water accounted for 92.6% of the company's pro forma turnover and 79.5% of pro forma profit after tax and minority interests. The total proceeds from the IPO amounted to about US$84 million for SPU. SPU was to use about HK$216.8 million of the proceeds from the IPO to acquire the No. 8 Water Plant in Shenyang which was owned and operated by Sino-French. The acquisition was to raise Shenyang Water's market share for the city's water supply from 65% to 95%. SPU was also to use about HK$149.5 million of the proceeds to improve production facilities of the subsidiary. In June 2002, SPU sold its 99.37% stake in Shenyang Water, its water subsidiary, to the municipal government-owned Shenyang Zheng Xing Enterprise Group Co for 900 million yuan (US$108.7 million). The company said in a statement that it was shifting its focus to investments in property and education projects, for which the net proceeds of the sale would be used. The partially divested utility was thus no longer responsible for water operations. None None