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Galaxy close to completion of restructuring
(China Economic Net)
Updated: 2007-04-06 09:30  China Galaxy Securities, the country's largest brokerage by trading volume last year, has completed government registration for its 167 branches ahead of a possible initial public share offering.
The Beijing-based brokerage, with healthy assets spun off from a near-bankrupt older unit, had almost completed its restructuring, the company said. One of the biggest steps taken had been completing the registration of its new name with local governments for its branches across the country, it said. Galaxy Securities has yet to announce its listing plans. It was reported earlier that the brokerage was targeting a share sale in Shanghai in the second half of the year. "The assets are relatively good and it should present a good opportunity for investors to buy," Guotai Junan Securities analyst Liang Jing said. The old unit received 7 billion yuan (US$906 million) from the Ministry of Finance and Central Huijin Investment, the central government's investment company, in August 2005 and was renamed China Galaxy Financial Holding, controlling three units in broking, investment and fund management. The company made a 2.1 billion yuan profit last year and earned 3.4 billion yuan from brokering and investment banking. Trading revenue was 2.6 billion yuan from a volume of 1.9 trillion yuan, ranking it the top mainland brokerage. Galaxy Securities is among many domestic brokerages that almost went bankrupt a few years ago amid a market downfall and money owed to many other institutions that put funds into brokerages for management. It had to give away stakes to repay debts to former clients. Shanghai Pharmaceutical said it was obtaining about 10 million shares at five yuan each in the brokerage, which would share extra earnings equally if the eventual listing price was higher than five yuan. PICC Property and Casualty last week said it planned to get 2 percent of a brokerage under a June 27 deadline as the brokerage could not pay back 588 million yuan worth of treasury bonds in its custody. Galaxy Securities was the one referred to, according to a Shanghai Securities Journal report. "The return on the Galaxy stake should be huge and PICC is very lucky to get it," Mr Liang said. "The insurer also has the opportunity to partner with the brokerage in business operations." Galaxy Securities said it would not yet announce future plans. PICC could not be reached for comment yesterday. (For more biz stories, please visit Industries)
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