STATE-OWNED cosmetics maker Shanghai Jahwa yesterday pledged not to raise funds in the next three years to ensure the new owners of the company won't be affected by market speculation.

In a filing to the Shanghai Stock Exchange, the company vowed it will not propose any refinancing plans, including issuing notes or bonds, so long as it has sufficient cash flow to support its business and operations by the end of 2014. But the company made it clear that its pledge did not cover stock option incentive plans.

Jahwa currently has 941 million yuan (US$148 million) in cash. It generated 2.87 billion yuan in revenue for the third quarter this year, an increase of 18 percent from the same period a year earlier. Its cosmetics products have earned a profit of 280 million yuan over the past nine months, an annual jump of 33.8 percent.

Jahwa, valued by the government at 5 billion yuan, is the subject of a takeover bid by Hainan Airlines and Shanghai Pingpu Investment which have each placed a deposit of 500 million yuan.

The government requires the successful new owner not to transfer ownership within five years.