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Sanmao at centre of Gansu’s SEO reform
Posted on Thursday, 09 August 2018 08:09
Gansu province’s State-Owned Assets Supervision and Administration Commission is injecting engineering consultancy assets into Chinese textile group Lanzhou Sanmao Industrial in an all-scrip deal worth CNY 2.22 billion (USD 324.17 million). China is pushing for mixed ownership reform among its state-owned enterprises (SEOs) and the integration of quality assets and resources with listed entities. Not only does the acquisition of Gansu Engineering Consulting by Sanmao tick this box, but it also feeds into supporting urbanisation and infrastructure construction. The deal should create a horizontal industry player with services spanning bidding for tenders through to delivering projects and one that would be in a position to take advantage of future opportunities. Formed in April 2018 as a holding company, Gansu Engineering has eight wholly-owned subsidiaries involved in water conservation, urban and rural planning, and civil engineering project design and supervision, among other things. Gansu Provincial Architectural Design and Research Institute carries out surveys, and the design and management of, industrial and civil engineering projects. Gansu Provincial Water Conservancy and Hydropower Survey and Design Institute plans and designs hydroelectric, wind and other renewable energy generation plants, and assesses environmental impact of construction and geological hazard risks. Cost consultation, general contracting, mapping, landscape architecture and property appraisals and geotechnical surveys are covered by Gansu Provincial Urban and Rural Planning and Design Institute. Gansu Construction Supervision on manages projects while Gansu Tendering Consulting is mainly an agency that bids for commissioned international and domestic tenders. Gansu Civil Engineering Research Institute is focused on inspections, surveys and geotechnical and disaster management assessments. In contrast, Gansu Provincial Traffic Engineering Construction Supervision is a highway and traffic engineering consultant, and Lanzhou Qianyuan Transportation Planning and Design Consulting researches, evaluates and looks at ways of financing of transportation infrastructure projects. Woolen products manufacturer Sanmao will issue 195.14 million new shares at CNY 11.37 apiece as payment to Gansu Provincial State-owned Assets Investment for the acquisition. © Zephus Ltd