A company official said US-based investment bank Morgan Stanley is arranging the sale for the company but refused to say how much CNBM plans to raise in the initial public offering.

"With recent years of reform and adjustment, CNBM needs to absorb funds in order to catch up with the constantly expanded business scale," said a senior researcher with China Galaxy Securities.

In 2004, the turnover of CNBM came to 12 billion yuan(US$1.48 billion) and the business income increased progressively by more than 50 per cent every year in the past 3 years, according to the company's Web site.

The company has prepared for several years to list its shares overseas, according to the senior researcher in China Galaxy Securities.

The business of CNBM covers design, manufacturing and sales of new building materials, chemical building materials, as well as import and export of these products. In many of these fields, CNBM plays a leading role in China.

CNBM has 20 billion yuan(US$2.46 billion) in total assets. The Beijing-based company also has 200 affiliated companies and a staff of 30, 000. CNBM has a controlling percentage of shares in four publicly listed companies and a substantial stake in 11 others.

China is now one of the world's largest building materials producers, with annual output of cement, plate glass, construction ceramics and sanitary ceramics ranking first in the world.

Driven by a bullish real estate market, all sectors of China's building materials industry have recorded profits. It is forecasted that such a growth pace will be maintained in the next few years.

Cement manufacturing is the largest sector in China's building materials industry. Among China's top 100 building materials companies in 2003, 59 were cement manufacturers.

China's largest cement maker, Anhui Conch Cement Co Ltd has entered an agreement with two foreign strategic investors to take stakes in the firm last month.

However, despite the huge output of China's building materials, the quality of these items is usually well below international standards. It is in the high-end, high-quality niche market that foreign building materials have found the most success.

Many foreign building materials companies have descended on China, including the Salux Group, Owens Corning, LG Chemicals and Energy, B&Q and OBI.

With China's accession to the WTO and liberalization of the residential housing market, China's building materials market anticipates further growth.

(Source: China Daily)