(Yicai Global) Nov. 16 -- GreatStar Industrial, a hand tool maker, has become the ninth Chinese company to issue global depositary receipts in Europe this year while over 30 firms have announced similar plans.

GreatStar finished its secondary listing on the Six Swiss Exchange yesterday, raising about USD155 million, the Hangzhou-based firm said in a statement today. The eight companies that came before GreatStar garnered almost USD3 billion.

Europe is attracting an increasing number of Chinese firms seeking equity financing as the China Securities Regulatory Commission revised its rules in December to open up a link between the Chinese and European capital markets.

Some 32 enterprises listed in Shanghai or Shenzhen have revealed their plans to issue GDRs in Europe this year. The majority of them, or 27, chose the principal stock exchange of Switzerland, while for some, the London Stock Exchange is the preferred destination.

GDR issuances can broaden listed Chinese firms' overseas funding channels, Mandy Zhu, head of China at UBS' global banking arm, said to Yicai Global. It allows foreign investors to learn about them and enhances brand influence within upstream and downstream parts of the industry chain and partnerships, she added.

Most of the 32 firms already have an overseas presence. Several of them have announced that they intend to use the listing proceeds to invest in new projects abroad to boost their outputs and expand into new markets.

GDR issuers can bring in industrial or strategic investors while promoting synergies, perfecting corporate governance, and driving international developments, Zhu said.

The Six Swiss Exchange is attractive to Chinese firms because of its review procedure, regulatory system, and other factors, said Zhang Xinyuan, analyst at Huatai Securities. For example, it usually only takes 20 working days for the bourse to finish the review of application materials, and the exchange also exempted GDR issuers from disclosing some information.

But in terms of the market environment and investor participation, there are no essential differences between the three bourse options in Switzerland, the United Kingdom, and Germany, Zhu said, adding that all of them are mature securities trading centers in Europe and they all attract world-famous firms for listings with global institutional investors. Issuers can take their pick based on their international strategies, she added.

Editors: Tang Shihua, Emmi Laine, Xiao Yi