December 4, 2014 / 2:16 AM / 3 years ago

China's CNR, CSR seek state nod for merger, submit draft plan - Xinhua

SHANGHAI, Dec 4 (Reuters) - Chinese trainmakers China CNR and CSR Corp have submitted the first draft of a merger plan to the State Council for discussion and approval, official news agency Xinhua reported on Wednesday.

Xinhua was citing a source from the government’s supervisory body for state-owned firms, who it said did not provide more details on the plan’s contents.

The 21st Century Herald newspaper earlier on Wednesday, quoting sources in the government and at the firms, said CSR would buy all CNR shares via a secondary public offering, and that the latter would delist from the stock market.

A CNR official contacted by Reuters declined to comment on the reports and referred to the company’s previous filings. CSR did not immediately answer calls for comment.

Shares in the two firms have been suspended since Oct. 27 amid reports that the government is merging them to create a giant able to compete with the likes of Germany’s Siemens and Canada’s Bombardier for high-speed rail orders abroad.

Last Friday, both firms extended their share suspensions, citing the “complexity” of the matters both were dealing with which they said may “result in significant asset restructuring”. (Reporting by Brenda Goh; Editing by Muralikumar Anantharaman)

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