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Privatisation of the MTR Corporation  
 
Product Ref: 00/100C Company: Mass Transit Railway Corporation Limited

Product Type: Case Industry: Transportation

Related Product(s): Teaching Note
Authors: Ko Wang   Su Han Chan   Mary Ho
On 3 March, 1999, the Financial Secretary of Hong Kong announced in his budget speech that the Government planned to partially privatise the MTR Corporation ("MTRC") through the sale and listing of a minority interest in the Corporation's shares. The listing of this integrated rail operator on 5 October, 2000 created an important precedent for future privatisation of government assets. However, a host of uncertainties remained about how value enhancement was achieved in this privatisation. This case would be an excellent vehicle for students to explore the motives behind the privatisation of government assets and the implications of privatisation for management's operating and financial strategy. Students can compare and contrast the privatisation methods used by different countries to privatise railways and can assess the appropriateness of the Hong Kong Government's method of privatising the MTRC. At the same time, students can also evaluate the timing of the privatisation and the appropriateness of the offer price.
Functional Area : Economics & Business Policy
Finance & Investments

Issues: Privatisation, Initial Public Offering
Length: 26 pages Country: Hong Kong SAR

Pub. Year: 2001 Level of Difficulty: 2
         
This product type is available in the following language(s):      English
         
Related Information: N/A
 
This case is UGC funded.
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