Sinotrans and UPS joint venture
Sinotrans Ltd, a Chinese freight forwarder, will procure a 50 percent stake in a joint venture with United Parcel Service.
Sinotrans said it will pay US$652,200, through its 70 percent-owned unit Shanghai-listed Sinotrans Air Transportation Co Ltd (Sinoair), for the stake from its controlling shareholder, state-run, China National Foreign Trade Transportation Group, Corp.
Government-controlled Sinotrans, which also has a joint venture with DHL Worldwide Express, raised US$500 million in a Hong Kong public offering in February.
China currently restricts delivery activities of foreign couriers and forces them to operate through joint ventures with local companies.
UPS owns about three percent of Sinotrans and plans to increase the number of offices it has China to 20 from 12 by the year end as it taps the country’s booming parcel market.
Sinotrans Hong Kong-listed shares closed at HK$2.30 and the stock has climbed 34.6 percent in the past three months.
Sinotrans has a 30 percent market share in China’s growing express services market, but this rises to 60 percent if joint ventures are included.
