Funds may buy bonds abroad
Local state-controlled investment funds may lower holdings in local-currency government bonds and buy US Treasuries, or European and Japanese debt, to pursue higher returns, the Chinese-language Economic Daily News reported, without saying where it got the information. Managers of the funds, such as pensions and insurance, are allowed to make the change after restrictions on their investments are eased, the Taipei-based paper said. Returns from US Treasuries and European government bonds are at least 2 percentage points higher than those of Taiwan's government bonds, the paper said.
■ Mobile phones
Fuji Photo to build lens plant
Fuji Photo Film Co will spend about ¥2 billion (US$17.2 million) to build a plant in China that will produce lenses used in camera-equipped mobile phones, the Nihon Keizai newspaper said. The company will start construction on the plant this summer, the paper said, without saying where it obtained the information. The factory will be completed by the end of the year, employ 1,000 people and have the capacity to make 5 million units a month, the newspaper said. The plant will be Fuji Photo's third in China, the newspaper reported.
■ Arms trade
Thales plans ADI takeover
French defense giant Thales yesterday announced plans for a complete takeover of Australia's largest military manufacturer, ADI, in a move that could raise concerns in Washington. Thales and Australian construction giant Transfield currently each own a half share in ADI, which was privatized by the Australian government in 1999 for almost A$350 million (US$260 million). No figures were given for the ADI takeover bid.
South Korean rail strike ends
South Korean railway workers yesterday called off their three-day-old strike and decided to return to work, a labor union spokesman said. "Union members will end their strike and they will immediately return to work," Cho Yun-ho, a spokesman for the union of Korea Railroad (KORAIL), told journalists. "However, this decision does not mean an end to our struggle. We will push through with our demand even after we return to work," he said. Cho said the union would demand that management reinstates 2,244 union activists who had been suspended from their jobs on Thursday and Friday as a prelude to further action against them, including dismissal or wage cuts.
CAO approves restructuring
Shareholders of China Aviation Oil (Singapore) Corp (CAO) voted in a new board of directors and approved a restructuring plan that would pave the way for a resumption of trading in its shares by the end of this month, the company said. CAO's shares have been suspended from trading on the Singapore Exchange since late 2004 after its revelation that it had incurred some US$550 million in undisclosed losses from trading oil derivatives. Under the restructuring plan approved on Friday, creditors can opt for an upfront cash payment of US$0.45 on every US$1 owed, or a higher repayment rate of US$0.58 a dollar spread over five years, the company said. A large part of the money will come from CAO's Chinese state-owned parent China Aviation Oil Holdings, which will inject US$75.7 million for 34.4 percent of CAO's post-restructuring share capital, bringing its total stake to 51 percent.