Pi Haizhou: Promoting The Small Scale Financing System Of Gem

In October 30th this year, the gem will celebrate its 5 birthday. It is reported that 5th anniversary of the gem in China's stock market will usher in new opportunities for development. A number of major institutional changes, including allowing the loss of Internet companies to list, are in the pipeline. Among them, allowing Internet and technology innovation enterprises that meet certain conditions and not yet profit-making have been listed on the gem for 12 months after they have been listed on the new third board, have been written in a few opinions recently issued by the SFC on the support for Shenzhen's capital market reform and innovation, and the implementation of the policy will not be too long.

The gem, which was formally opened in October 30, 2009, has made great progress in the past 5 years. So far, the GEM listed companies have broken through 400, the total market capitalization of the stock exceeds 2 trillion yuan, and the amount of financing is close to 270 billion yuan. In order to promote China's economic spanformation, it has played a positive role in guiding the capital flow to the emerging media and technology industries and giving full play to the function of resource allocation in the capital market. Gem has become an important engine of China's economy.

Not only that, the gem is also an experimental field for some stock market reform. Some major institutional reforms can give priority to pilot projects on GEM. For example, the management intends to allow the loss net enterprises that meet certain conditions to appear on the gem, which is a major change in the stock market system. It is necessary to give priority to the gem. In fact, over the past 5 years, there has been a more successful system in the growth enterprise market. For example, the "small financing system" is a successful attempt. It can be extended to the small and medium sized boards and even the main board market.

In the various basic systems of the gem, the refinancing system is a relatively late system. Almost 4 and a half years after the start of the growth enterprise market, the Interim Measures for the management of securities issuance of listed companies on GEM were released in May 16th this year. However, because the system has been fully brewed, the provisions of the system are also more perfect. In particular, the "microfinance system" has become a major highlight of the refinancing system of GEM companies, and has also become a major highlight of the growth enterprise market. After the launch of the system, the GEM companies responded enthusiastically.

Gem's "small financing system" obviously has three bright spots. First, the amount of financing is small. The amount of financing is not more than fifty million yuan, and does not exceed the net assets of listed companies at the end of last year ten percent. Compared with tens of billions or billions of big financing, this kind of microfinance not only has little impact on the market, but also hardly brimming with money.

Two is financing Fast speed, belongs to lightning financing. On the one hand, for microfinance, the SFC carries out summary auditing. The SFC will make approval or disapproval within fifteen working days from the date of acceptance. On the other hand, there are no more than five target issuing companies on GEM, while microfinance usually can be completed by one or two institutions, so it is easy to find specific issue objects.

The three is financing. cost Low. According to the gem Listed company "Interim Measures for the administration of securities issuance" stipulate that non-public issuance of shares can be sold by listed companies on one of the following occasions: (1) the object of issue is the former ten shareholders; (two) the issue object is the controlling shareholder, the actual controller or the related party of the listed company; (three) the target of the issue is the director, supervisor, senior manager or employee of the listed company; (four) the board of Directors considers the relevant domestic and foreign strategic investors or other issue objects that have already been determined when considering the relevant motions. In terms of microfinance, the above requirements can basically be met. This means that microfinance also saves brokerage fees.

It is also based on the above bright spots that the "small financing system" has been welcomed by the GEM listed companies. A number of GEM companies, such as Jinfu new material, spin pole information, LIAN energy saving, Tsing Chi technology, Chow Ming technology, Hua Wu share, and abbin chemical, have all chosen the way of microfinance to carry out refinancing. Among them, the issue share of Hua Wu shares is all subscribed by the real controller Nie Jinghua. When the share of the technology increase is issued, it is owned by the harvest fund, while the Chow Ming technology is issued to 5 executives of the company, including general manager Wang Rongli. This fully reflects the characteristics of quick and flexible microfinance. Therefore, the "small financing system" is a successful attempt of gem, which can be extended to small and medium-sized boards or even the motherboard. Some SMEs, including those listed on the Shanghai stock market, also apply this system.

Of course, if we want to get a finger at the "small financing system", it is prudent to choose the actual controller. After all, issuance to the actual controller will further consolidate its position in the listed company, which is not conducive to improving the corporate governance structure. At the same time, it is easy to trigger a suspicion of interest spanmission or insider trading to the actual controller, which also needs to be avoided.