Engine making units of China's Avic set to be spun off, shares surge
A new firm, controlled by the central government, will become the parent of the three companies, state media reports
Aviation Industry Corporation of China (Avic) is preparing to spin off three aircraft engine subsidiaries, a newspaper reported on Wednesday, in a move that is part of a broad government effort to improve the competitiveness of China’s state-owned conglomerates.
A new firm, controlled by the central government, will become the parent of the three companies, the official Shanghai Securities News said without identifying the source of the information.
Sichuan Chengfa Aero-Science and Technology , Avic Aero-Engine Controls and Avic Aviation Engine Corp announced in separate stock exchange filings late on Tuesday that Avic may not be their controlling shareholder after a government-related restructuring.
Stocks for the three firms climbed by their daily limit of 10 per cent on Wednesday.
The restructuring was being handled by the State-owned Assets Supervision and Administration Commission, the central government's assets administrator, an Avic spokesman said, adding that Avic was not involved in the process.
An executive at Sichuan Chengfa said the firm would remain under the control of the state.
