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China’s COSCO Shipping considers London listing

Logistic News - Published on Tue, 11 Dec 2018

Image Source: Ekathimerini
Reuters reported that China’s largest shipping group, COSCO Shipping (601919.SS), is considering raising capital for the first time on the London Stock Exchange through a new initiative with Shanghai’s bourse, two finance sources familiar with the matter said. The Shanghai-London Stock Connect will enable Chinese companies to raise fresh money on the LSE through issuing global depository receipts (GDR), which could boost momentum amid concerns that Brexit could dent the City of London’s leading position in financial markets. The LSE is hoping to get a boost from China as the world’s fastest growing capital market.

The sources, who declined to identified citing sensitivity, said COSCO Shipping Holdings Co (1919.HK), which is Shanghai and Hong Kong listed, was examining the possibility of issuing GDRs in London. No decision had been taken yet, partly as it would also require Chinese regulatory approval.

One of the sources said that “Any capital raising would be large to make it worthwhile and also to bolster connections with foreign investors.”

The second source added: “For political reasons as well, London would be a preferable capital destination for COSCO rather than New York, for instance.”

COSCO, which has an estimated market capitalisation in Shanghai of $5.5 billion (4.31 billion pounds), did not respond to requests for comment.

Developing a tie-up between Shanghai and London is the latest in a series of efforts by China to gradually bring its vast stock markets into the world trading system.

However, the arrest this week of a top executive of China’s Huawei Technologies Co Ltd [HWT.UL] in Canada and her possible extradition to the United States has roiled global stock markets on fears the move could escalate a trade war between Washington and Beijing after a truce was agreed days earlier between President Donald Trump and Xi Jinping.

COSCO, which is the world’s no. 3 container shipping line, is still contending with pressured markets and has been looking at expanding its activities globally.

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Posted By : Joykumar Irom on Tue, 11 Dec 2018
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