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BIZCHINA / Overseas Investment

Nod to Alstom to buy Wuhan Boiler stake

By Xiao Wan (China Daily)
Updated: 2007-07-12 14:13

The China Securities Regulatory Commission has approved a 51 percent
stake sale of Wuhan Boiler to Alstom for 338.9 million yuan.

Alstom, French power and transportation equipment maker, will purchase
151.47 million shares from Wuhan Boiler's parent Wuhan Boiler Group, the
Chinese firm said in a statement.

After the deal, Wuhan Boiler Group will retain a 6.91 percent stake in
the listed Wuhan Boiler.

Wuhan Boiler makes boiler systems for the power industry.

The deal was earlier approved by the Ministry of Commerce and the
State-owned Assets Supervision and Administration Commission,
Shenzhen-listed Wuhan Boiler said in the statement.

According to French newspaper Les Echos, Alstom will make Wuhan Boiler a
base for global exports. Wuhan Boiler will eventually export a third of
its output from a factory Alstom plans to modernize, said the newspaper.

Alstom earlier said it will introduce new technology and improve
management to boost Wuhan Boiler.

Active in China's power industry, Alstom last year opened Alstom Beizhong
Power Co Ltd, a joint venture with Beijing Heavy Electric Machinery
Works. The company aims to build the joint venture into one of its most
important global manufacturing centers for power generator equipment.

The joint venture has so far delivered power equipment to major domestic
power companies such as China Guodian Corp and China Power Investment
Corp.

Analysts said the Wuhan Boiler deal underlines foreign investors'
interest in the machinery sector in general, best illustrated by Carlyle
Group's attempts to acquire Xugong Group Construction Machinery Co Ltd.

(For more biz stories, please visit Industry Updates)

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