A sustained slump in Chinese equities could halt plans by state-owned conglomerate Citic Ltd. to list some of its units, Chairman Chang Zhenming said as the nation’s shares plunged by the most since 2007.
“If China’s stock markets continue to decline in the second half, we may have problems with our current restructuring and listing plans,” Chang said at a briefing in Hong Kong on Monday. “Some of our listing plans may fall through.”
The chairman’s comments came as China’s benchmark stock index tumbled as much as 9 percent on a worsening economy and concern that the government may withdraw from its efforts to prop up the market.
In an earlier statement to Hong Kong’s stock exchange, Chang had said some units could be listed “when the timing is right” or the units could team up with other companies. He didn’t specify which subsidaries he was talking about.
At the briefing, Wang Jiong, the company’s vice chairman and president, said Citic may announce a plan in September for its real estate business. Citic said in March that it was undertaking a review that could lead to a restructuring of businesses including property, oil fields and mines.
Citic’s net income rose 46 percent from a year earlier in the first half to HK$37.7 billion ($4.9 billion), the company said. In Hong Kong, shares of the state-controlled company rose 0.3 percent on Monday, bucking the 5.2 percent decline in the Hang Seng Index.
Citic sprang from Citic Group, China’s first state-owned investment corporation, which was set up in 1979. The company, which describes itself as China’s biggest conglomerate, holds stakes in firms including Citic Securities Co., the nation’s biggest listed brokerage.