DOMESTIC express parcel delivery firm Shentong (STO) Express is planning a back-door listing through a deal that would see it take over a publicly traded firm in Shenzhen, a company executive said Friday, offering investors a rare chance to get a slice of the fast-growing sector.

    STO Express, which says it delivers one in six parcels in China, will pursue the listing through valve maker Zhejiang IDC Fluid Control Co., whose shares have been suspended since August pending restructuring. Zhejiang IDC said earlier last week the two firms were in talks for a shares-for-assets deal.

    The deal would give STO a listed shell, bypassing China’s lengthy initial public offering (IPO) process and likely making it the first of its peers to go public. This would allow investors to buy into the fast-growing logistics sector being driven by China’s booming e-commerce market, led by giant Alibaba Group Holding Ltd.

    “We’ve been planning this for many years,” an executive in STO’s marketing department said. The executive, who said she was authorized to discuss the plan but declined to give her name, confirmed the deal would entail a back-door listing.

    She declined to comment on financial terms. Zhejiang IDC’s market value is about US$716 million, according to the price of its suspended shares.

    The express delivery sector grew around 50 percent each year between 2010-2014 and handled 14 billion parcels last year, State Post Bureau data show. But, it has remained elusive for investors due to the dominance of private and State-owned firms.

    “We want to improve our governance and services to build up the STO Express brand,” she added. “China’s express delivery companies do not currently have the same standards as overseas firms, the listing will be conducive to this.”

    (SD-Agencies)