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Woman, 66, may rake in millions from ChinaNetCenter listing

By Qiang Xiaoji (chinadaily.com.cn)
Updated: 2009-10-29 17:07

Chen Baozhen, a 66-year-old Chinese woman, is about to become a millionaire after her company ChinaNetCenter, a Shanghai-based Internet firm, makes its debut on ChiNext -- China's NASDAQ-style second board -- with another 27 companies on Friday, Shanghai Securities News reported today.

Chen holds 34.86 percent of the company's shares. The issue price of ChinaNetCenter is 24 yuan a share, meaning total shares held by Chen will be worth 567 million yuan ($83.03 million), approximately 90 times more than her 6.2 million-yuan investment over the past ten years.

A retiree of an electronic instruments plant under the Fisheries College of Jimei University in Fujian province, Chen is the founder and biggest shareholder of ChinaNetCenter. In January 2000, Chen, 57, established an Internet firm in Shanghai with Zhou Aijun to provide IDC (Internet Data Center) services.

At that time, IDC was an emerging technology in the United States while China's network technology was still at the ISP (Internet Service Provider) stage. In this sense, Chen could be considered as one of the pioneers in the IDC business sector.

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The registered capital of ChinaNetCenter was initially 2 million yuan, with Chen and Zhou investing 1 million yuan each.

After several capital increases, stock rights transfer and the introduction of strategic investment, by 2009 Chen had invested 6.2 million yuan in total, owning 34.86 percent of the company's shares.

Liu Chengyan, the former chief operation officer of HiChina, a leading Internet application service provider in China, now holds 21.37 percent of ChinaNetCenter's shares. After the company's listing on the GEB, Liu's holding of the shares will reach 347 million yuan.

An industry insider said Chen might not be a real shareholder of ChinaNetCenter, the report said. The person behind her -- the real founder of the company -- has an overseas education background, the newspaper said, citing the insider.

According to reports, the earliest clients of the company were mainly foreign companies who wanted to enter China's Internet market. A founder with an overseas background could provide much convenience while Chen's background was obviously not in accordance with it.

The reports were not confirmed by ChinaNetCenter. The company also declined to reveal any information about Chen, but said as the prospectus showed, Chen is the founder and the biggest shareholder of the company.

The electronic instruments plant where Chen used to work no longer exists after its integration into Jimei University, so Chen's profile is not available.

ChinaNetCenter's shareholders also include some big names in China's venture capital industry. Two subsidiaries of Fortune Venture Capital together hold 7.62 percent of ChinaNetCenter's shares. Shenzhen Capital Group and Shenzhen Capital Company Limited together hold 6.82 percent of the company's shares.

ChinaNetCenter will be listed on the GEB on Friday, the day the GEB officially opens for trading.