Under The Registration System, Backdoor Listing Enters The Ice Age, And The Merger And Reorganization Of Capital Market May Be Optimized

The shell is completely worthless.

With the continuous promotion of the registration system reform, the formal implementation of the new delisting rules, and the normalization of face value delisting, backdoor listing, which has attracted much attention before, has entered the ice age, and the number of backdoor listing has continued to decline, and few enterprises have finally completed backdoor listing.

An investment banker of Morgan Stanley Huaxin Securities said that backdoor listing has been a non mainstream event in M & A. the value of A-share shell resources will continue to decline, and the A-share shell ecology is accelerating reconstruction.

An investment banking professional published a comment post of "from cold to frozen - write about the A-share M & a market in 2020" on Weibo, clearly stating that "the M & A projects in the meeting have reached single digits, compared with IPO and refinancing in the same period, the M & a market is significantly marginalized. Seven years later, the market returned to its former appearance, "and sighed," don't talk about backdoor, absolutely non mainstream events. "

The number of backdoor listing continues to decline

According to the statistics of CSRC, a total of 396 new shares will successively land on the Shanghai and Shenzhen stock markets in 2020, raising nearly 470 billion yuan. The number of listed enterprises and the total amount of capital raised are both the highest in recent 10 years.

However, the M & a market is not warm and tepid. Compared with the trend of stock price doubling in the past, the M & A transactions in 2020 did not attract much attention from the market, and the stock price was generally flat.

It is worth mentioning that the number of backdoor listing in M & A has dropped sharply. According to wind statistics, only six enterprises have completed backdoor listing in 2020, including tianxiaxiu, wanbangde, Luoxin pharmaceutical, Tianshan aluminum, Zhennong and St Hongsheng.

Compared with the peak period of backdoor listing, 34 enterprises in 2015 have declined significantly, and compared with 9 companies in 2019, the proportion of decline is more than 33%.

Among the six backdoor listed companies, only Tianshan Aluminum Co., Ltd. has a transaction amount of more than 10 billion yuan, and the previous backdoor listing of tens of billions has no longer existed.

In July 2020, Tianshan aluminum's project of borrowing from the new territories pump industry was officially completed. According to the plan, the new territories pump company has invested 100% equity of Tianshan aluminum through three transactions: major asset replacement, share issuance to purchase assets and share transfer. In this transaction, Tianshan aluminum is valued at 17.028 billion yuan. After the completion of the transaction, the main business of the listed company has become the production and sales of raw aluminum, prebaked anode, high-purity aluminum, alumina and aluminum deep-processing products and materials.

In this regard, investment bankers said that in the context of the pilot registration system reform, a large number of leading companies will choose to go public directly. Backdoor assets are more or less enterprises with IPO obstacles. Giants do not choose backdoor, so the backdoor market is naturally cold.

Small cap stock shell resource price decreases

Once upon a time, the A-share listing platform under the approval system was regarded as a scarce resource, so that some listed companies were still sought after by funds after being reduced to "poor performance stocks".

Li Xunlei, chief economist of China Thailand Securities Co., Ltd., said that as a supporting part of the registration system, the market-oriented delisting system will play a decisive role in the long-standing "shell stocks" phenomenon in the A-share market. In the past, if you bought a stock, you would take it and wait for it to be unrolled. This operation will not be feasible because bad stocks are likely to be like the "fairies" in the Hong Kong market, and will have to be delisted in the end.

Li Xunlei believes that in the past, some listed companies with poor performance and small market value were often concerned about, and many of them finally realized a gorgeous turn by backdoor listing. Therefore, the transaction activity and market value share of small market value stocks of a shares have always been on the high side. Taking the market value of stocks below the median market value as an example, a shares are significantly higher than mature capital markets such as US stocks, and small companies with poor performance in the future will be further ignored.

The 21st century economic reporter also learned that as of January 11, there were 12 fairies with a share price less than 1 yuan in the A-share market, of which the lowest share price of * ST Haichuang B closed at 0.102 yuan.

Senior investment banks in Shenzhen also said that the promotion of registration system reform will greatly reduce the value of shell resources. In the future, pure shell valuation will gradually approach that of Hong Kong stocks. The main board shell of Hong Kong shares is currently valued at HK $400 million to HK $500 million, while the gem is valued at $100 million to $200 million.

Although the value continues to decline, shell resources will not disappear completely. Many investment bankers have said that some assets are not suitable for the strict requirements of IPO, and may still rely on the shell platform path.

The trend of restrainingpoor performance companies' reorganization and backdoor listing

Zhang Yundong, former director of Shenzhen Securities Regulatory Bureau, said publicly in an interview with the media that the capital market is a place for survival of the fittest and optimization of resource allocation. However, in the past, the delisting system was too loose, leaving more room for some people to operate. The "empty shell" was sought after, and the chaos of "shell protection", "shell selling" and "backdoor" emerged in endlessly.

Therefore, we should strictly limit the restructuring and backdoor listing of poor performing companies, and implement a firm delisting system.

On December 31, 2020, Shanghai and Shenzhen stock exchanges issued a new delisting system covering the whole market, and it will come into effect from the date of promulgation. The new delisting system reform fully draws on the rules of the new delisting system of the science and technology innovation board and the gem, and is fully implemented in the main board and the small and medium-sized board. In other words, the new delisting system has implemented the whole market coverage earlier than the registration system.

With the continuous promotion of the registration system reform, the merger and reorganization of the capital market may usher in optimization, and the standardization will also be improved. Industry insiders point out that under the background of the continuous expansion of listed companies, there will be more shell buying based on the industrial value of the acquisition target, not merger and reorganization, but industrial integration. "The reduction of shell price is good for industrial integration, because around the listing The cost and resistance of the company's acquisition and integration are reduced, which is conducive to the industrial integration transaction. "

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