HONG KONG — Air China will land simultaneously at the London and Hong Kong stock exchanges on December 15, where it hopes to raise well over £514 mn ($998.3 mn) from its dual flotation. The Air China float appears to be a coup for the London Stock Exchange (LSE) as the Chinese flag carrier could have opted for a New York listing.
An LSE spokesman couldn’t resist a swipe at the NYSE following its triumph. ‘Some companies have been very critical of the US Sarbanes Oxley standards seeing them as an unnecessary barrier. But we have very different regulations which are based on principles, rather than inflexible, hard rules.’
However, the LSE PR wooing machine is likely to have been assiduous, supported with the opening of a new LSE office in Hong Kong in November.
Although Chinese governance is hardly a byword for world class quality and rigour, Air China’s London floatation could encourage other Chinese companies keen to access London’s capital markets, and up their governance standards. China market analyst Gareth Leather from Business Monitor International, though, thinks the Chinese national air carrier’s governance quality may still be a work-in-progress situation. ‘Air China’s governance is probably not great, however it must have met certain standards to have been able to list on the LSE.
‘Martin Graham, director of market services at the LSE, said that Air China’s decision to list in Hong Kong and London offered an example for other Chinese companies to follow. ‘We anticipate further companies following their lead,’ he says.
