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24Sep92 CHINA: HOPEWELL HOLDINGS PLANS TWO ROAD PROJECTS IN SOUTHERN CHINA.

Gordon Wu, the flamboyant head of Hong Kong Hopewell Holdings, is planning to start construction next year on two road projects in southern China worth HK$5,720 million (£400 million).The road plans were announced at the beginning of this month, only days before Hopewell reported almost record profits of HK$1,620 million (£112 million).Work on at least one of the roads, a 28 km stretch of the Guangzhou - Shenzhen - Zhuhai superhighway in Shunde, will start early next year once final approval has been given by the Zhongshan and Zhuhai district governments.The second network is also centred on Shunde and entails the development of two roads and five bridges to provide a connection between the two and the main highway.Under the deal, Hopewell has agreed with the Shunde administration to build and operate the links at a cost of more than HK$1,000 million (£70 million).Revenue from road and bridge tolls would be split between two sides and after 30 years' ownership will transfer to the city administration.Mr Wu estimated the joint investment will be repaid after seven years.Meanwhile, Hopewell's profits rose by a massive 126 per cent to HK$1,620 million (£112 million) in the year until June. This compares with HK$718.85 million (£50 million) in 1990-91.Analysts said that more than 60 per cent of the rise can be attributed to interest and investment income from a rights issue last year.This was meant to raise finance for the superhighway and Hopewell's Bangkok elevated railway project. But the relatively slow progress of these schemes meant Hopewell has been able to keep much of the cash that was raised in the bank.These cash reserves are estimated at between HK$4,000-5,000 million (£276-345 million).