Chinese Enterprises In Wall Street Go&Nbsp; Public

One is the cruel reality of Wall Street games, the other is ignorance. China Enterprises, when the two are combined, the collapse of Chinese enterprises is naturally reasonable.

Imagine that you are the boss of a clothing company. For various reasons, you are very short of money, but because there is no asset mortgage and no bank loan, a mysterious person took the initiative to find you and said that he could bring you money. This mysterious man is not a venture capitalist, or rather a broker.

If you are interested in this, you will learn from his mouth that he is a Chinese American. The way he brings you money is to go to the United States.

You may think this is a faraway tale, but he tells you that everything is simple enough to make you feel at ease. He says you can't know anything, as long as you are willing to spend money. major Brokerage firms, law firms, accounting firms and public relations companies provide tailored services. If you have enough money, Goldman and DDT are willing to serve you.

So you moved. Save the details. In short, you signed a contract with him and paid him a large sum of money. Soon, he will introduce a broker to you. It may be Goldman Sachs or an unknown small institution, depending on the amount of money you pay. Generally speaking, the broker will ask for a certain percentage of the Commission of the amount of financing, plus the "green boots" (the excess placement option in the stock issue). If you promise, the next thing will be done for you.

The first thing a broker should do is to find a trusted accountant company and accountant for you. company Make the financial statements of your enterprises as bright as possible in accordance with the American accounting system in order to get a larger sum of money, because this is closely related to his interests. Then, the securities company found a law firm to help you reform the ownership structure and do all that. Your company is in line with the US listing standard.

Next, the broker recommends that you go on the market by reverse takeover, because this is much simpler than direct IPO, and there is no need to worry too much about censorship. You agree. They recommend you a shell company that has no deal. The company may be registered by the broker himself, but they don't need to let you know. You spent a sum of money to buy it.

After that, hedge funds that are inextricably linked to securities companies are extremely strong. Cheap The price is funded by PIPE financing (public company's private placement), and, of course, they will make sure that they can not lose by means of convertible bonds.

This is done for about a month, and then you go public. You made a small IPO and raised $40 million. Soon, hedge funds and brokerages sold out. After deducting the expenses of these intermediaries, you got $about 30000000.

So far, at least, you are a real boss of an American listed company.

When a rat runs across the street everybody cries, "kill it!" -- a person hated by everyone

Soon, however, you find that your landing is not an ordinary stock exchange. market Instead, it's the OTCBB market, or Pink Sheets. The pink market and OTCBB are equivalent to the delisting market in China, and the market transactions are very light. Although the listed companies in the OTCBB market once reached the listing standards and conditions of the Nasdaq market, they can easily transfer to the board to achieve the NASDAQ listing and the cost is very low. But when the enterprises can not transfer the board to the Nasdaq, their shares will be trapped in the American powder market or OTCBB, without liquidity and low value, which will cost millions of dollars per year and lose the possibility of refinancing.

You may realize that your position is in danger. At this time, however, something bad came.

Some short selling agencies are eyeing you because your earnings data are "too good to be true". The reports issued by the short selling agencies have caused panic in the market, and your share price has gone through the drain. In the end, some investors have suffered losses, while the short sellers have received a handsome return. This is not the worst. At the same time, some law firms began to "take the trouble". They read your account statement carefully, and you could have contacted the investors and investors.

So, more institutions start for you. investigation 。 Among them, the United States Securities and Exchange Commission (SEC). The intervention of SEC has affected the confidence of US investors in the whole Chinese concept stock. So the company has been extended to all Chinese Listed Companies in the United States, but the miracle of not being responsible for the law has not happened. Finally, after a series of processes, you have been suspended, or you have been ordered to withdraw from the market.

In fact, this is not a story, but a real fact. The "you" here may be any of the many Chinese Listed Companies in the United States, such as Southeast China, Dalian greenno, China high-speed media Holdings Limited and so on.

Since March this year, more than 20 Chinese companies have been suspended from the NASDAQ or New York stock exchange, or have been ordered to withdraw from the market. More Chinese enterprises have suffered a sharp fall in share prices, including star enterprises such as Sina, Sohu and Baidu. China's stock market, which was once so great, became instant mouse.