CHINA: REVIVAL IN OVERSEAS EQUITY SALES

CHINA OVERSEAS SALES REBOUND IN JPMORGAN BANKER’S OUTLOOK

Bloomberg News

Bloomberg, July 25, 2012

Chinese companies’ overseas share sales will rebound next year as regulators root out fraud and misconduct that contributed to erasing $6.4 billion in value for mainland firms listed in the U.S., the senior investment banker in China for JPMorgan Chase & Co. (JPM) said.

There will be “a flurry of deals” once foreign investors’confidence in Chinese companies returns, Fang Fang, chief executive officer of China investment banking for New York-based JPMorgan, said in an interview in Beijing yesterday. The bank is ranked third among managers of overseas share sales by Chinese companies since the start of 2010.

“I’m hopeful that sometime in the second half, investors will come back to the table,” he said. “Investors will eventually see the value and have to do something. They can’t just sit on a pile of cash for too long.”

A revival in overseas equity sales, on track this year to raise about a third of 2010’s $61.5 billion, would bolster growth in the world’s second-largest economy. Only one Chinese company has made its U.S. trading debut in 2012, compared with about 60 in the previous three years, as short sellers such as Muddy Waters LLC said companies including Sino-Forest Corp. misstated accounts, data compiled by Bloomberg show.
“There are just a lot of companies who want to raise money,” Fang said. “We need investors to come back to the table.”

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