Western Securities Co is busy preparing to sell its shares via an initial public offering after teaming up with Bank of New York Mellon Corp, its spokesman said yesterday.

The move will help Western Securities become a listed brokerage which has a foreign firm as a partner, analysts said.

"We are on track to apply for the share sale," said its spokesman surnamed Zhu, who declined to comment more.

The 21st Century Business Herald reported yesterday that Western Securities will submit an application to the nation's financial regulator next month. The IPO of the Xi'an-based firm is backed by the Shaanxi provincial government, the report said.

On November 15, Western Securities signed an agreement with the Bank of New York Mellon Corp to establish a joint venture fund management company called BNY Mellon Western Fund Management Co.

Western Securities owns 51 percent of the new company, which will be headquartered in Shanghai, and will be launched in 2008 after gaining regulatory approval.

The joint venture is expected to manage Chinese stocks under a range of retail fund products initially and will develop more products over time tapping the expertise of the American bank, the world's biggest asset custodian.

"It is high time that brokers competed with each other to seek public funds and foreign partners to prepare for brutal competition after China opens the market to overseas peers," said Dai Ming, an analyst with the Kingsun Investment Management Co.

Earlier this month, Huatai Securities Co changed its structure into a shareholding company to prepare for an IPO. Huatai expects to start floating shares in the first quarter next year.

Other brokers such as Everbright Securities Co, Orient Securities Co, China Merchants Securities Co and Guotai Jun'an Securities Co are also preparing to sell shares.

"Compared with back-door listings, where risks such as insider trading may be higher, the regulator encourages IPOs based on good performance of brokers in recent years," Dai said.

Western Securities earned 760 million yuan (US$101 million) in the first half of this year.

(Shanghai Daily November 28, 2007)