Government officials yesterday expressed optimism over Taiwan High Speed Rail Corp's (THSRC,
THSRC, which is building the nation's first high-speed railway, has decided to pay a 5 percent dividend with the preferred shares, as part of the company's fund-raising plans to increase capital by NT$18.4 billion this year. The rail system is expected to be completed by 2005.
Unlike common stocks, which are sold to individual investors or mutual funds with no performance guarantees, preferred stocks are issued to a designated group of investors with a fixed yearly dividend.
With potential investors showing a lot of interest in buying these shares, THSRC may sell out all the NT$50 billion-worth preferred shares by 2003, said Ho Nuan-hsuan (何煖軒), director-general of the Bureau of Taiwan High Speed Rail, citing a 5-percent dividend combined with the shares more attractive than other investment targets in the current capital market.
Nita Ing (殷琪), who has been meeting with potential investors on a weekly basis, said it is too early to say whether the company would have sold all stocks by the end of this year, according to a Chinese-language newspaper report.
But given the heated reaction in the market, it seems it would be no problem for the company to raise NT$18.4 billion in new capital by the end of this year, the paper said, quoting Ing.
According to THSRC, the eligible investors of the shares are banks and the firm's five largest shareholders, including Continental Engineering Corp (
The Chiao Tung Bank (
However, Fubon said it is still awaiting the "terms" for buying THSRC shares, set to be released on Nov. 16, and has not yet made a decision whether to buy or not.
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