Companies at a glance

New airline

HNA Group, parent of China's fourth-largest carrier Hainan Airlines, launched a joint venture called Tianjin Airlines last Monday in the northern port city. The joint venture Tianjin Airlines has a registered capital of 1.3 billion yuan, the company said in a press release.

The company was renamed from Grand China Express Co after receiving a 200-million-yuan investment from Tianjin Port Free Trade Zone Investment Co. HNA Group holds 83.15 percent stake and Hainan Airlines holds a 1.47 percent stake in the new venture, with Tianjin Port Free Trade Zone Investment Co taking the remaining 15.38 percent share.

Diesel production

Beijing Foton Cummins Engine Co Ltd kicked off the production of Cummins light-duty high performance diesel engines in Beijing last week. The Cummins ISF engine, the first produced in China, will be used in light commercial vehicles in both China and international markets. The 50-50 venture between China's Beiqi Foton Motor Co and US Cummins Inc, with equity investment of $146 million, will have an annual production capacity of 400,000 units. The clean diesel engines meet stringent on-highway and off-highway emission standards worldwide, including Euro IV and above, the joint venture said.

Stake transfer

SDIC Huajing Power Holdings Co Ltd, a subsidiary of the State Development and Investment Corp (SDIC), last week announced that it will acquire all the equity interest of SDIC Electric Power Co from SDIC. SDIC Huajing Power Holdings said in a statement filed with the Shanghai Stock Exchange that it will issue 940 million shares at an average price of 8.18 yuan apiece to SDIC to fund the acquisition.

The net assets of SDIC Electric Power were valued at about 7.69 billion yuan as of Nov 30 2008. The acquisition will boost SDIC Huajing Power's total installed capacity by 86.13 percent to 12.64 gW. Meanwhile, the firm's installed capacity of hydropower will be increased to 5.215 gW from the current 565,000 kW.

Power purchase

China Power International Development Ltd, one of the five major national power-generating groups in China, said it will purchase a 63 percent stake in Wu Ling Power, the largest independent hydropower producer in Hunan province, from its parent for 4.47 billion yuan.

According to a statement released by China Power, 70 percent of the price will be paid through the issuance of 3.13 billion yuan in new shares at HK$2.408 apiece, and the remaining 30 percent will be paid in cash.

After the deal, the company's installed capacity will increase to 11,282 mW, representing a 25 percent increase compared with 9,037 mW at the end of 2008. Hydropower capacity will account for 32 percent of the company's total generating capacity. Through the acquisition, China Power will have completed its market layout in Hunan and Guizhou, and can start cracking the Chinese nuclear power market, an industry insider said.

(China Daily 06/15/2009 page7)