China eyes new state asset management firm: report

SHANGHAI (AFP) - China is weighing a plan to set up a new company to manage some of the country's nearly 18 trillion yuan (2.6 billion dollars) in state assets, a report has said.

The state-owned Assets Supervision and Administration Commission has been working to establish an asset management company since 2005, the state-run China Daily reported, citing director Li Rongrong.

Li, who made the comments during an online question and answer session, did not give details of the scope of the new company or a timetable for its establishment.

Li also warned many state-owned enterprises were not qualified to make overseas acquisitions and would have to improve their corporate governance.

"Only by increasing corporate governance can they have more opportunity to make a successful merger and acquisition," he was quoted as saying.

The commission currently oversees 138 state companies directly controlled by the central government and aims to eventually reduce that number to between 80 and 100 through restructuring and consolidation.