Tue, Nov 16, 2010 - Page 12 News List

Digital China to list TDRs on Nov. 24: KGI Securities

RED CHIPS RISING:The company is looking to take advantage of a Chinese IT sector, that expects sales to grow by 13.7 percent this year

Staff writer, with CNA

Digital China Holdings Ltd (神州數碼), a Chinese integrated IT service provider, tentatively plans to list its Taiwan depositary receipts (TDRs) on the main board on Nov. 24, underwriter KGI Securities (凱基證券) said yesterday.

KGI said the company would offer up to 260 million TDRs at a subscription price of NT$29 to NT$33, with each TDR representing 0.5 shares of Digital China, which has been listed in Hong Kong since 2001.

The public subscription plan has been warmly welcomed by the market, KGI said.

After the listing, Digital China will become the first “red chip” to sell shares in Taiwan, the Taiwan Stock Exchange said.

A red chip refers to a Hong Kong listed company that is incorporated outside China, but is under the control of Chinese shareholders, largely generating revenue in China.

Digital China operates regional centers in 19 major cities in China, with a network of more than 10,000 agents and strategic partnerships with more than 100 leading IT vendors worldwide.

It is the largest software service provider to the Chinese government, the second-largest provider to the Chinese financial sector and the fourth-largest provider to the Chinese telecoms industry.

In the six months from April to September, Digital China posted HK$537 million (US$69 million) in net profit, up 30.42 percent from a year earlier.

The company said it would continue to take advantage of a booming Chinese IT sector, which is expected to see a 13.7 percent increase in sales this year from the US$77.1 billion recorded the previous year.

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