The Ministry of Railways announced yesterday that it had found five overseas firms to invest in 18 railway container-distribution centers in China, representing a major step forward for the financial reform of the country's railway sector.

The ministry also announced the formation of China United International Rail Container Co Ltd, which is to build and operate the 18 centers. The centers will be located in regional economic centers throughout the country.

China Railway Container Transport Corp Ltd, an affiliate of the ministry, will be the biggest shareholder in the new firm, with a 34 percent stake. China International Marine Containers (Group) Co Ltd will hold 10 percent.

As far as the overseas firms, the Hong Kong-listed NWS Service Management Ltd will hold a 22 percent stake, while Hong Kong Promisky Investment Ltd will hold 10 percent.

The Israel-based Zim Integrated Shipping Services Company, France-based CMA CGM Group and Germany-based Deutsche Bahn AG will each take 8 percent stakes.

Ministry spokesman Wang Yongping described the establishment of the joint venture as "a milestone in the history of China's railway development".

"It also fully reflects our resolve to accelerate the financial reform of the railway sector," Wang said.

An initial assessment of the plan to build the 18 centers forecast investments worth at least 12 billion yuan ($1.60 billion). The company will have $560 million in registered capital, or about 35 percent of the total investment.

The ministry said it hoped having overseas investors on board would help introduce new management concepts and sharpen railways' competitiveness in the container transport market.

The ministry has been seeking foreign investment since last year.

Railways Minister Liu Zhijun told a national conference earlier this year that local governments, State-owned and private enterprises, social investment institutions and overseas funds were all welcome to invest in the railways.

Source: China Daily