BEIJING, June 25 (Reuters) - China Aviation Industry Corp II, one of the country's top military contractors, plans to list shares in Hong Kong in the "near future", the China Daily Business Weekly said on Tuesday.
The landmark listing would make the company, also known as AVIC II, the first of China's major military conglomerates to issue public shares, the newspaper said.
The listing plan calls for grouping major assets under a new shareholding company that would be created within two months, the newspaper said.
The State Council, China's cabinet, had already approved the plan, but the amount of money AVIC II planned to raise and exact timing of a listing had not yet been finalized, the paper said.
"The planned wholesale listing would include all the major business units it controls in the country, with the exception of some core units for military operations that are not suitable for public listing," the paper said.
Assets included would be aviation products for civilian use and export, as well as outsourcing operations and a subcompact car business, the paper quoted an official involved in the preparatory work as saying.
AVIC II makes helicopters, transports, trainers, general aircraft, engines and aviation equipment, minvans and cars, motorcycles and industrial turbines, the paper said.
The company was already overhauling its operations to bring them in line with Hong Kong regulatory standards, the paper quoted the official as saying.
AVIC II is controlled directly by the government and falls under the wing of the State Commission of Science Technology and Industry for National Defence, which the paper said was the top body in charge of military industries.
The company was created in the late 1990s when authorities split AVIC into two groups. AVIC II employs 210,000 people in 81 separate units with assets totalling 31.5 billion yuan ($3.8 billion), the paper said.
AVIC II is listed as China's sixth biggest military conglomerate, just behind AVIC I, which has more of a military focus, it said. The listing would pave the way for other Chinese military giants to issue shares and raise capital, part of a government plan to overhaul a sector which has been losing money but now faces competition after China's entry into the World Trade Organisation last December, the paper said. (US$1=8.28 yuan)