The China Securities Regulatory Commission has given Beiqi Foton Motor Co the go-ahead to sell new shares in Shanghai for future development, a company filing to the Shanghai Stock Exchange said yesterday.

China's biggest light commercial vehicle maker earlier announced the plan to issue 100 million to 111.2 million shares to raise up to 1.23 billion yuan (US$173 million) in Shanghai.

It is expected to sell the shares to no more than 10 investors in Shanghai, including its biggest shareholder, Beijing Automotive Industry Holdings Co, which is poised to buy 40 million shares at 9.88 yuan each.

The car maker said the new capital will be used to set up a venture with Cummins Inc to produce 2.8-liter and 3.8-liter engines in Beijing. It will also upgrade its bus assembly line and expand its engineering institute.

The share sales came after a Beiqi Foton plan to sell 297 million shares to the German car maker Daimler failed to get government approval.

The Beijing-based truck maker signed a new agreement with Daimler to set up a venture to make medium and heavy-duty trucks.

Beiqi Foton said its net profit rose sixfold to 388 million yuan last year on the back of increased sales and the launch of more high-end vehicles.

It had sales revenue of 27.8 billion yuan for 2007 after sales for the year rose 17 percent to 401,901 units.

Exports were a driving force in its sales pick-up.

(Shanghai Daily March 13, 2008)