After two years of organizational restructuring, state-run Tang Eng Iron Works Corp (唐榮) announced yesterday that the company is set to complete privatization by the end of this year, according to a statement released by the Ministry of Economic Affairs.
The privatization timetable is earlier than the August 2006 deadline set earlier by the ministry's Commission of National Corporations.
Tang Eng is 30.43 percent-owned by private investors, and plans to sell a 20 percent stake held by the government to the public by the end of the year, reducing the government's holdings to under 50 percent, the threshold for state-run companies to qualify as privatized, the statement said.
Tang Eng has contracted Taiwan International Securities Corp (金鼎證券) to manage the share offering, and plans to apply for a listing on the over-the-counter market, the Greitai Securities Market (櫃台買賣中心), it said.
The company has also gained approval from the Cabinet to reduce its capital from the current NT$7 billion to NT$3.5 billion in June in preparation for the listing, the statement said.
To comply with the privatization policy, Tang Eng initiated company reform two years ago, which has seen a substantial result in terms of cost efficiency, reduced personnel and financial structure, the statement said.
Bolstered by strong demand for steel, Tang Eng reported a pre-tax profit of NT$530 million for the first quarter of the year, and may exceed NT$2 billion for the whole year with stainless steel output of 340,000 tonnes, the statement said.
To meet the demand, Tang Eng further boosted its capacity from 25,000 tonnes to 30,000 tonnes per month. The company's turnover this year is expected to reach NT$23 billion, up from NT$22.2 billion last year, the statement said.
China Shipbuilding Corp (中船) is also scheduled to privatize by the end of the year. But privatization of other national corporations, such as Taiwan Power Co (台電), Chinese Petroleum Corp (中油) and Taiwan Sugar Corp (台糖) is taking longer, mainly because of labor disputes.
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