Xinhua Publications Circulation and Distribution Co Ltd (Xinhua C&D) was officially established yesterday in Beijing.

It is the first Sino-foreign joint venture in China's publications circulation sector, following the opening of the field to overseas investors in December last year.

The new company, with a registered capital of 300 million yuan (US$36 million), is jointly invested in by Xinhua Bookstore Head Office and 10 other publishing houses and private foreign investment firms.

Xinhua Bookstore Head Office, a subsidiary of China Publishing Group, is the largest shareholder, owning a 40 per cent stake in the new company.

The second largest shareholder, Beijing Boheng Investment Ltd, holds a 30.67 per cent stake.

A recently established, British Virgin Islands-registered company PAC-Poly Investments Ltd has a 27 per cent stake; the third largest holding.

Other shareholders include SinoMaps Press, Jieli Publishing House, the People's Publishing House, the People's Literature Publishing House, the Commercial Press, Encyclopedia of China Publishing House, Joint Publishing Company, and Beijing Zijincheng Investments Ltd.

The new company will take over the core distribution business of Xinhua Bookstore Head Office, engaging in wholesale and retail of domestic books, newspapers, periodicals and electronic publications, storage and logistics, transportation, and other services related to publishing.

"We are devoted to establishing a nationwide circulation network and optimized regional distribution networks, to consolidate our leading position among publications wholesalers," said Liu Guohui, chairman of Xinhua C&D and also president of Xinhua Bookstore Head Office.

With Xinhua Bookstore's extensive resources in marketing, information systems, logistics and brand value, and a modern management system and capital investment provided by its other shareholders, the new company is confident it will be able to deal with challenges and competition from foreign and private players in the near future, said Liu.

The company plans to be listed on the stock market in two to three years, if it develops in line with current strategy.

"The establishment of Xinhua C&D is an important move following government directions for speeding up the reform of the publishing industry," said Wu Shulin, deputy minister of the General Administration of Press and Publication.

(China Daily April 25, 2005)