February 15, 2019 / 8:26 AM / 6 months ago

Six firms including JD arm, Dongfeng Motor invest $354 million in China Railway unit

SHANGHAI (Reuters) - China’s national railway operator has sold a 15 percent stake in one of its units for 2.37 billion yuan ($349.9 million) to a group of six firms including JD.com’s logistics arm and Dongfeng Motor, in the latest implementation of the country’s mixed-ownership reforms.

Beijing has been trying to bring private-sector investment and management into state-owned companies to enhance their efficiencies and competitiveness. It has so far carried out such reforms in industries like aviation and telecommunications.

China Railway said on its official WeChat account on Friday that Dongfeng Motor, BAIC Motor, CRRC Corp, JD Logistics, Global Logistics Properties (GLP) and China International Marine Containers (CIMC) had bought the 15 percent stake in its unit, China Railway Special Cargo Services (CRSCS).

It did not specify how the 15 percent stake was divided up between the six firms but added that the deal could eventually aid plans for CRSCS to go public.

CRSCS, which offers railway cargo and vehicles transportation, put the shares up for sale on a Shanghai exchange in December, it said.

The move will help “enhance the company’s competitiveness in the market of special railway cargo transportation and help it upgrade into a modern logistics enterprise,” China Railway said.

A securities affairs representative for CIMC said the investment was in line with CIMC’s own plans to develop its business but declined to specify the size of its investment.

CRRC, Dongfeng Motor, BAIC Motor and GLP declined to comment while JD did not immediately respond to requests for comment.

State media reported in December that China had put together a fourth batch of state-owned firms that will undergo mixed-ownership reforms and expects to accelerate the process in 2019.

Reporting by Shanghai Newsroom and Brenda Goh; Editing by Gopakumar Warrier

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