A new regulation allowing management buyouts of state-owned assets and equity of small- and medium-sized state owned enterprises (SOEs) bars such transactions for major SOEs, state media reported. As SOE management buyouts gain in popularity, the new rules seek to establish transparency and set standards in buyer qualification, disclosure, financing means and other procedures. Li Rongrong, minister of State-owned Assets Supervision and Administration Commission (SASAC), said management buyouts of large SOEs are impractical now because of the lack of effective pricing mechanisms and adequate financing means for the management buyers. At the end of 2003, 98% of China's 150,000 SOEs were SMEs, SASAC said.
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