Qiangsheng taxis to top fleet in city
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Shares of Shanghai Qiangsheng Holding Co, one of the city's largest taxi operators, rose to the 10 percent limit Monday after it announced a private share placement to strengthen core business.
Qiangsheng Holding plans to issue a combined 245 million shares to buy taxis, car-leasing and tourism-related assets from its major shareholder Shanghai Qiangsheng Group and the group's parent Shanghai Jiushi Corp, its statement said yesterday.
Shanghai Jiushi has pledged to buy 181 million shares while Qiangsheng Group agreed to buy 64 million shares.
Qiangsheng Holding will sell the shares at 7.03 yuan (US$1.04) each to the two investors, a 2 percent discount on its last closing price of 7.17 yuan on June 14 when it suspended trading.
The restructure of Shanghai Qiangsheng marks another milestone in the city's efforts to consolidate state-owned assets.
Sun Donglin, chairman of Qiangsheng Holding, told reporters that the share placement would help the company to resolve horizontal competition and boost its profitability with expanded business scope.
Both Shanghai Jiushi and Qiangsheng Group have assets in the city's other major taxi operators, including Bashi and Changhai.
After the restructure, more than 12,000 taxis will be managed by Qiangsheng Holding, which accounts for more than 25 percent of Shanghai's overall taxi fleet, making it the city's biggest taxi management company.
Shares in Qiangsheng Holding closed at 7.69 yuan yesterday.
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