XCMG Completes $3 Billion Mixed-Ownership Restructuring
What’s new: Chinese construction equipment maker Xuzhou Construction Machinery Group, known as XCMG, brought in 16 new shareholders as part of a two-year mixed-ownership restructuring to convert from a wholly state-owned enterprise to a mixed-ownership corporation.
XCMG said the mixed-ownership overhaul involved a 15.66 billion yuan ($2.3 billion) injection of new capital and a 5.4 billion yuan ($793 million) equity transfer, making it the largest mixed-ownership project this year.
After the restructuring, the company’s state parent will hold a 34.1% stake, with 16 other shareholders — including state-controlled financial institutions, industrial funds, local state-owned enterprises in Jiangsu province, private investment institutions and an employee stock ownership platform — holding the remaining equity.
The strategic investors will take three seats on the nine-member board of directors, the company said.
The background: China launched the mixed-ownership program in 2013, aiming to bring private-sector investment and management into state-owned enterprises to improve their efficiency.
Last year, XCMG’s industrial internet unit, XCMG Information, brought in 300 million yuan of investment from a group of private investors.
In 2019, XCMG reported net profits of 3.72 billion yuan on revenue of 78.3 billion yuan.
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