CHINA: Great Wall Motor to issue A shares for wide-ranging projects

By Simon Warburton | 12 October 2010

Great Wall Motor has resumed share trading on the Hong Kong Stock Exchange this morning (12 October) after suspending activity yesterday afternoon.

The Chinese automaker is to issue up to 121,697,000 A shares, for a wide range of new projects, although the potential funds to be raised have not been disclosed.

"Trading resumed this morning," a Hong Kong Exchanges and Clearing (HKEx) spokesman confirmed to just-auto from Hong Kong.

"They [shares] were suspended yesterday lunchtime - they are talking about issuing A shares."

Despite the value of the share issue remaining unknown, a statement from Great Wall Motor to HKEx noted: "The company intends to apply the proceeds from the proposed A share issue, after deducting offering expenses, on projects on the production of diesel engines, EG engines, six-speed manual transmissions, aluminium alloy casting, axles and brakes, interior and exterior decorations and automotive lightings."

Great Wall added if proceeds from the share issue were not sufficient to finance its ambitious range of projects, it would cover the shortfall from is internal resources or bank loans.

The proposed share is subject to approval by shareholders at the EGM and class meetings and approval of other regulatory authorities.

Great Wall Motor is one of China's so-called big four independents and last year produced nearly 223,000 vehicles.

Models include the Voolex sedan, Florid, Hover SUV, Haval SUV, Wingle pick-up and Coolbear.

IM Group, the UK-based importer and distributor for Subaru, Isuzu and Daihatsu, said today its planned launch of the Great Wall brand was on target for the first quarter of 2011.

Knocked down kits of Great Wall models are assembled or planned for assembly in Russia, Indonesia, Iran, Nigeria, Ukraine and Vietnam.

Great Wall Motor was not immediately available for comment.