(China Knowledge, Sep 11, 2006)--Gushan Environmental Energy, a producer of biodiesel fuel, has decided to postpone its proposed US$200 million initial share sale on the Hong Kong Stock Exchange due to recently-announced regulations by the Chinese government regarding red chip listings.

Gushan Environmental had already received approval from the Hong Kong Stock Exchange for its listing and was supposed to begin trading in the later part of this month.

However, following new regulations that took effect last week Friday, the company and its sponsor Credit Suisse Group have decided to put the share offering on hold, the South China Morning Post reported quoting a person familiar with the situation.

¡°The company believes it is safer to put its listing plans on hold and resubmit all documents and materials to the China Securities Regulatory Commission (CSRC) and the Ministry of Commerce for approval,¡± the source told the paper.

¡°I expect (the share sale) will be cleared as quickly as the first half of next year,¡± he added.

Beijing recently announced two major changes to regulations governing red chip listings ¨C listings of Hong Kong-incorporated companies that are shell companies for assets injected by Mainland firms.

Firstly, the CSRC will be given power over all red-chip listings ¨C something that the securities watchdog had relinquished in Jun. 2003.

Secondly, approval from the Ministry of Commerce will required for any red-chip applications in addition to requirements for approval from the CSRC and the State Administration of Foreign Exchange.

Details of the new regulations have yet to be announced by the government and Gushan Environmental is planning to hold its IPO till further clarifications are provided on new procedures.
Source:China Knowledge
tag:China energy