The world“s second-largest producer of cathode-ray tube glass, Nippon Electric Glass (NEG), of Japan, is planning to buy about 10% of the new B shares offered by a Shenzhen listing candidate.
The af…
The world“s second-largest producer of cathode-ray tube glass, Nippon Electric Glass (NEG), of Japan, is planning to buy about 10% of the new B shares offered by a Shenzhen listing candidate. The affiliate of NEG Corp would take up shares in Shijiazhuang Baoshi Electronic Glass, which makes bulbs and cathode-ray tubes for black and white TVs, analysts have been told. NEG, which has a 35% share in the world“s colour bulb market, is the technology provider of Baoshi“s 84%-owned new colour bulb production line. The bulbs are a key component of cathode-ray tubes. The project, costing 2.65 billion yuan, allows Baoshi to diversify into the manufacturing of bulbs for use in colour sets. Baoshi, based in Hebei province, China, would be allocating about 10% of its 150 million new B shares to NEG, analysts were told, giving the Japanese company a 3.68% stake in the firm. The deal is one in a string of ventures in which foreign firms have been taking strategic slices of mainland firms. The share offer, with Shanghai Shenyin Securities as lead underwriter and Daiwa Securities (HK) as international co-ordinator, represents 36.87% of the company“s enlarged share capital. Baoshi is selling the shares at 5.3 to 6 times its 1996 projected earnings of 171.1 million yuan, according to Richard Taylor, director of equity capital markets at Daiwa Securities (HK). Baoshi could raise up to HK$ 351 million from the share sale, based on the indicative issue price range of between HK$ 2.07 and HK$ 2.34 a share, Mr Taylor said. Earnings per share for this year were forecast at 42.1 fen. The issue would be internationally placed with institutions and the promotional tour began in Hong Kong, proceeding to Singapore, Europe and Tokyo. The listing was expected in either April or May, depending on the exchange“s schedule. Last year, Baoshi made a profit of 170.2 million yuan, up from 116.2 million yuan. Subsidiary PT Nippon Electric Glass Indonesia is to invest US$ 300 million in a plant which will produce five million cathode-ray tubes, the company“s president, Masao Yamahashi, announced. “We will initially invest US$ 80 million to develop the first stage of the industry,” Yamahashi said after the ground-breaking ceremony for the plant in a 20-hectare area in the Jababeka industrial estate. The company is 70% owned by Nippon Electric Glass, 20% by Sumitomo Corporation and 5% by PT Bukaka, a local company. He added that the plant will eventually become the biggest in Southeast Asia after the Nippon Electric Glass factory in Malaysia which has an annual capacity of 15 million cathode-ray tubes. The Malaysian plant cannot be expanded because of a shortage of manpower, he said. “I am sure there is a large number of workers whom we can employ for our industry here,” said Yamahashi, adding that he will employ 100 in the first phase. The company plans to export some of its products to Japan and Taiwan. Deputy president of the Jababeka Industrial Estate, S.D. Darmono, said that Nippon Electric Glass is the fourth major investor at the 800-hectare estate after United Tractor, Unilever and the Dharmala Group.