On May 10, the Shanghai Stock Exchange decided to terminate the review of the issuance of shares by Guolian Securities Co., Ltd. (hereinafter referred to as "Guolian Securities") to specific targets.
On March 2, 2023, the Shanghai Stock Exchange accepted the application documents for Guolian Securities to issue shares to specific targets in accordance with the law, and reviewed it in accordance with the regulations.
On April 29, 2024, Guolian Securities and the sponsor, China Securities Co., Ltd., submitted to the Shanghai Stock Exchange the Application for Withdrawing the Review of the Application Documents for Guolian Securities Co., Ltd. to Issue Shares to Specific Targets and the Application for Cancellation of the Sponsorship of Guolian Securities Co., Ltd.'s Issuance of A-shares to Specific Targets, respectively, to withdraw the application documents for the issuance of shares to specific targets and to revoke the sponsorship of issuing shares to specific targets and listing on the main board.
In accordance with the relevant provisions of Article 19 of the Rules for the Examination and Approval of Securities Issuance and Listing of Listed Companies on the Shanghai Stock Exchange and Article 63 (2) of the Rules for the Examination and Approval of the Issuance and Listing of Stocks on the Shanghai Stock Exchange, the Shanghai Stock Exchange has decided to terminate the review of Guolian Securities' issuance of shares to specific targets.
On June 5, 2023, Guolian Securities announced that it had received the third round of inquiries from the Shanghai Stock Exchange about its 7 billion yuan fixed increase plan.
Regarding the necessity of financing, the Shanghai Stock Exchange pointed out that according to the application materials, the total amount of funds raised by Guolian Securities through the issuance of shares to specific targets does not exceed 7 billion yuan, all of which will be used to further expand the scale of credit trading business including margin financing and securities lending, expand the trading business of fixed income, equity, equity derivatives and other transactions, and repay debts; The last round of review inquiry letter has inquired about the necessity of the company's financing.
The first issue is the use of funds in the business to be invested in the reporting period, the level of profitability, the comparison with comparable companies, and the industry ranking.
The second is to explain the necessity of this financing, the rationality of the financing plan and method, and whether it is conducive to improving the efficiency of capital utilization and giving full play to the use of raised funds in combination with the ability of shareholders to return and value creation, its own operating conditions, the company's main responsibilities and main businesses, market development strategies, the investment direction of the previous raised funds and the realization of benefits.
The third is to explain the rationality of the scale of financing and whether there is excessive financing in combination with the detailed use plan and investment amount of monetary funds at the end of the period, the specific calculation basis and process of each investment content of the raised funds, and the calculation of the funding gap.
The initial disclosure of Guolian Securities' 7 billion yuan private placement plan was on September 28, 2022, and it was accepted by the China Securities Regulatory Commission at the end of December of that year, and the first round of inquiries was replied to on January 19, 2023. After the implementation of the full registration system, the private placement plan was transferred to the Shanghai Stock Exchange for review and accepted on March 3, 2023, and the Shanghai Stock Exchange once again questioned the necessity of refinancing.
Talking about the necessity of private placement, Guolian Securities mentioned in its second inquiry reply that its various financial indicators and main business indicators continue to rise rapidly in the industry rankings, and the rankings of total assets, net assets, and operating income have all risen from more than 50 in 2019 to more than 30 in 2021, and it has ranked among the first echelon of the industry in the fields of public fund investment consulting and over-the-counter derivatives business. Although certain achievements have been made, there is still a large gap compared with the medium and long-term strategic development goals, and the prominent problem is that the capital scale is too small, which seriously restricts the company's comprehensive service ability to customers.
On the issue of the reasonableness of the financing scale, the sponsor China Securities Construction Investment said in its reply to the second inquiry that the issuer has carefully analyzed and calculated the specific investment direction of the raised funds in combination with the actual situation of the company's business development, and clarified the specific scale of the raised funds to be invested in various businesses. The direction of the use of the funds raised by the issuer, the business to be carried out and the scale of the business to be carried out match the company's operating conditions, asset scale, strategic development goals, etc.
On June 9, 2023, Guolian Securities announced a new version of the private placement plan. After three inquiries by the Shanghai Stock Exchange, the brokerage company plans to reduce the fixed increase quota from 7 billion yuan to 5 billion yuan, a decrease of nearly three percent.
According to the data, Guolian Securities was established in 1999, and the legal representative is Ge Xiaobo, a member of Wuxi Guolian Development Group, which is an enterprise mainly engaged in capital market services. The registered capital of the company is 2.832 billion yuan, and the major shareholder of the company is Wuxi Guolian Development (Group) Co., Ltd., holding 46.41442% of the shares, and the major shareholder of Wuxi Guolian Development (Group) Co., Ltd. is the State-owned Assets Supervision and Administration Commission of Wuxi Municipal People's Government, with 93.3262% of the beneficial shares.