August 11 -- China Railway Group’s (601390) private placement plan recently expired, reports China Business News, citing a company filing.

The company had initially planned to raise 6.2 billion yuan by issuing 1.52 billion shares at 4.11 yuan per share. China Railway Engineering Corporation, the biggest shareholder of China Railway Group, said it will purchase 3.5 billion yuan worth of shares in the current issuance.

Of the total raised funds, 4.44 billion yuan was earmarked for the construction of line five of the Shenzhen subway system, while 1.80 billion yuan would fund bridge construction in Liuzhou city, Guangxi province.

Later, the company fixed the per-share issue price at 4.05 yuan and adjusted the issuing amount to 1.54 billion shares.

However, in light of shifts in China’s macroeconomic policy leading to uncertainties in the government auditing process, the company did not exercise the private placement, and it expired.

The company posted net profit of 1.67 billion yuan and earnings per share (EPS) of 0.08 yuan in the first quarter of 2011.

The company won 13 contracts worth 22.4 billion yuan in July, accounting for 4.74 percent of the company’s 2010 revenue. In the first seven months, the company won 19 projects, totaling 34.3 billion yuan.

Source:CapitalVue