Updated: 2005-07-05
China Construction Bank (CCB) said yesterday it has reached an agreement with the Singapore-headquartered Temasek Holdings (Private) Limited on entering into a strategic partnership.

The bank and the Asia Financial Holdings Pte Ltd (AFH), a wholly-owned subsidiary of Temasek, signed a definitive strategic investment agreement on July 1.

Under the agreement, Temasek will invest in China Construction Bank through AFH, which will place US$1 billion into CCB at a planned international initial public offering (IPO) for CCB. AFH will also purchase certain existing shares from China SAFE Investments Ltd, subject to regulatory approval.

In addition, AFH will assist China Construction Bank in improving corporate governance, including the right to nominate suitable candidates for election to the CCB board of directors. Other areas of collaboration and support are under discussion.

Temasek is an Asian investment company headquartered in Singapore. It manages a diversified global portfolio of US$54 billion.

China Construction Bank said the strategic partnership with Temasek demonstrates that it has taken another important step forward in deepening reform and improving corporate governance, and also signifies that its strategic investor negotiation process is basically complete.