This also resulted in changing the system's Chinese name from "地鐵" ("Subway") to "港鐵" "(Hong Kong Railway").Īll adult Octopus Card holders would be the first to benefit from the merger. The merger was approved by shareholders of the MTRCL on 9 October 2007. The KCRC is now a holding company of the KCR system, without actual railway operations. On 2 December 2007, the Chinese name of the MTRCL was changed to 香港鐵路有限公司 (literal translation: Hong Kong Railway Corporation Limited) after being granted the Service Concession while the English name will remain unchanged. Leasing the operation rights of the KCR system to the MTRCL avoided actually selling the KCRC. It was widely considered that the government's choice was to avoid being criticised for selling assets of the KCRC, which it wholly owned, to MTRCL for an unreasonably low price. The KCRC's lines were less profitable than those of the MTRC, and the KCRC was less active in property development. In addition, MTRCL would make a payment of $7.79 billion for the acquisition of property and other related commercial interests. The KCRC would receive a one-time upfront payment of HK$4.25 billion, a fixed annual payment of HK$750 million and a variable annual payment based on revenues generated from operation of the KCR system. Under the non-binding Memorandum of Understanding the government has signed with KCRC, KCRC would grant a service concession to the MTRCL to operate the Kowloon–Canton Railway (KCR) system, with an initial period of 50 years. On 11 April 2006, the Hong Kong Government officially announced the details of the proposed merger. In March 2004, the Hong Kong Government officially encouraged the two companies to merge. The MTRCL backed such a merger while the KCRC opposed the plan. There had been some discussion of merging the Kowloon-Canton Railway Corporation (KCRC), which was also government-owned, and the MTRCL to make the territory's transport system more efficient. Ticket gates at key interchange stations have been removed one year after the merger The MTR has continued to be one of the few profitable public transport systems in the world. In June 2001, MTR was added to the Hang Seng Index.Īt the time of the initial public offering, the company was operating with a surplus of HK$360 million (US$46.1 million), which had increased from a surplus of HK$278 million (US$35.6 million) in 1997. On 5 October 2000, the company was listed on the Hong Kong Stock Exchange with 600,000 shareholders. The offering was for one billion shares, but this was increased to 1.15 billion due to high demand. On 11 September 2000, the financial secretary of the Hong Kong Government, Sir Donald Tsang, announced the partial privatisation of MTR Corporation Limited. Following a successful initial public offering, the MTRCL was listed on the Hong Kong Stock Exchange on 5 October 2000, however the government is still the majority stakeholder in the MTRCL. As with the MTRC, the MTRCL's principal business is to operate the mass transit railway system. On 30 June 2000, the MTRC was succeeded by the MTR Corporation Limited (MTRCL, 地下鐵路有限公司). The Mass Transit Railway Corporation ( Chinese: 地下鐵路公司) was established on 22 September 1972 as a government-owned statutory corporation to build and operate a mass transit railway system to meet Hong Kong's public transport needs.