(Yicai Global) April 13 -- State-owned Commercial Aircraft Corp. of China Ltd. (COMAC) will set up a CNY10 billion (USD1.59 billion) aircraft industry fund this year as part o efforts to spur on the development of the related industry chain in China.
The fund, to focus on the development of large-aircraft, will allow more players to reap the rewards of the fast-developing industry, Securities Daily reported COMAC Chief Accountant Zhou Qimin as saying.
Although large-aircraft manufacturing businesses lose money during their growth stage, combining industry and finance effectively cannot only solve financing issues, but also promote the healthy development of the whole industry chain, he said.
“Some investment banks have conducted research on potential suppliers in the large-aircraft industry chain. Those companies in the industry chain currently perform well and look forward to becoming century-old companies and are currently considering what to do over the next 10 years to develop their business layout,” Zhou said.
Participants in the funds will be able to grasp new business opportunities, Zhou noted, adding that they can also provide supporting products and components to COMAC, thereby enhancing its own technical product capabilities as well as brand and corporate value.
The fund is part of COMAC’s goal of letting investors share in the fruits of the rapid development of the industry.
"COMAC has begun to use capital market tools. For instance, we have issued medium-term notes and CNY3 billion corporate bonds,” Zhou said, adding that the company fully utilizes financial means available for now. The company also aims to increase its share capital this year.
When talking about the issue of public listing, he hopes that a potential IPO can enhance inclusiveness and open up a listing channel for companies that have lost money during the growth stage of their businesses.
"IPO listing is the most effective form of integration between industry and finance in the large aircraft sector and is the most direct mixed ownership method," Zhou said, adding he believes that many investors intend to pursue large aircraft.
Editor: William Clegg