Top Biz News

Deutsche Boerse courts local IPOs

By Wang Ying (China Daily)
Updated: 2010-01-12 08:01

Boasting the most attractive global location for small and medium-sized enterprises (SMEs) to go public, Deutsche Boerse AG is eying China to recruit more members.

"We are expecting at least five Chinese companies to be listed this year," Wu Jianhong, chief representative officer of Deutsche Boerse in Beijing, told China Daily.

So far, a total of 15 mainland enterprises have listed on the Deutsche Boerse, including firms in environmental protection, information technology, consultancy and real estate. Zhongde Waste Technology Ag, a producer of garbage incinerators, was the first to debut in July 2007.

According to Wu, Deutsche Boerse listings are tailored to SMEs as it takes 100,000 euros to go public in the US and the UK, but a Deutsche Boerse listing only requires application fees ranging from 750 to 5,500 euros.

In addition, Deutsche Boerse procedures are both efficient and transparent, Wu said.

Listing overseas has become popular among Chinese enterprises, with 176 mainland companies launching IPOs around the world. Total capital raised hit $54.65 billion in 2009, up 150 percent from a year earlier.

Among them, 77 were listed in overseas markets, and capital raised topped $27.14 billion, up 292 percent year on year, according to a report by ZERO2IPO Research Center in early January.

Tim Halter, chairman and CEO of Halter Financial Group - a consulting firm that specializes in taking other companies public - pointed out that Chinese firms are desperate for capital to maintain rapid growth.

Deutsche Boerse's Wu agreed. "There are too many IPO applicants and China's stock market cannot hold them all," he said. "Companies here have to wait for decades if they want to get listed at the current processing speed."

Some Chinese firms may be unwilling or unable to wait. "Many Chinese companies will launch overseas IPOs in the near future," said Halter.

So far, the Hong Kong stock market and NASDAQ are the two most popular listing locations for mainland enterprises.

Last year, 52 mainland companies raised a combined $24.84 billion from IPOs in Hong Kong. Meanwhile the NASDAQ attracted eight Chinese companies to raise $1.48 billion, and the New York Stock Exchange saw five companies raise $459 million.

This April, Chinese companies will get a chance to review their German listing options at the Halter Financial Summit to be held in Shanghai.

Deutsche Boerse is the world's largest bourse by market value, the company said. It reported a total pre-tax profit of 1.51 billion euros in 2008.

As one of the world's largest exchange organizations Deutsche Boerse provides investors, financial institutions and companies access to global capital markets. The company has approximately 3,300 employees servicing customers in Europe, America and Asia.