China Merchants plans two spin-offs

Hong Kong-listed China Merchants Holdings announced that it will move out of roads and tankers to focus its business on ports. The company plans to spin off non-core assets, valued at US$463.6 million, by the end of 2004. Chairman Fu Yuning said the company wants the cash to expand port and logistics operations. Fu said he envisioned two separate spins-off for the divisions, which now account for a fifth of the group's net asset value. The company operates five toll roads in south China and one of Hong Kong's cross-harbor tunnels, which together generated US$17.9 million, or 12% of profits last year. The company's tanker business accounted for 16% of profits last year.