China Fund News Chenxi
After leading the current round of mergers and acquisitions of brokerages, Guolian Securities is about to resume trading!
On the evening of May 14, Guolian Securities disclosed a major asset restructuring plan and a series of related announcements, and the details of the transaction were further clarified.
The Guolian Securities plans to issue A shares to purchase 100% of the shares of Minsheng Securities held by 46 entities including Guolian Group, at an issue price of 11.31 yuan per share; It is planned to issue A-shares to no more than 35 specific investors to raise matching funds, with a total amount of no more than 2 billion yuan and no more than 250 million A-shares. After deducting expenses, the raised funds will be used to develop Minsheng Securities business.
In addition, due to the planning of major asset restructuring, the trading of A shares of Guolian Securities was suspended from April 26. After applying to the Shanghai Stock Exchange, the A-share shares of Guolian Securities will resume trading from the opening of the market on May 15.
Let's see the details -
It is expected that 100% of the acquisition of Minsheng Securities will raise no more than 2 billion yuan
Specifically, let's look at the details of the major asset restructuring of Guolian Securities——
Compared with the preliminary confirmation intention of the shareholders of Minsheng Securities, who hold 95.48% of the shares, announced before the suspension, the acquisition ratio has been further increased to 100% in the plan announced by Guolian Securities.
According to the plan, Guolian Securities intends to purchase 100.00% of the shares of Minsheng Securities held by 46 counterparties such as Guolian Group and Shanghai Fengquanyu through the issuance of A shares, and raise matching funds. After friendly negotiation between the parties to the transaction, the issue price of the shares of the reorganization is the average trading price of A-shares in the 120 trading days before the pricing benchmark date, that is, 11.31 yuan per share.
At the same time, Guolian Securities intends to issue A-shares to no more than 35 specific investors to raise matching funds. The total amount of matching funds raised shall not exceed RMB2 billion (including the principal number), and the number of A shares issued shall not exceed 250 million shares (including the principal number), and the final amount of funds raised and the number of shares issued shall be capped by the amount of funds raised and the number of shares issued by the Shanghai Stock Exchange and the registration decision made by the CSRC.
The pricing benchmark date for supporting funds raised is the first day of the issuance period of shares to specific objects, and the stock issuance price is not less than 80% of the average trading price of the company's shares in the 20 trading days before the pricing benchmark date of the supporting funds, and not less than the company's latest audited net assets per share attributable to ordinary shareholders of the parent company before the issuance. The final issue price will be determined through negotiation based on the bidding results, and the raised funds will be used to develop Minsheng securities business after deducting expenses.
In accordance with the relevant regulations, after applying to the Shanghai Stock Exchange, the A-shares of Guolian Securities will resume trading from the opening of the market on May 15, 2024 (Wednesday).
Guolian Securities reminded that the transaction still needs to be reviewed by the company's board of directors and reviewed and approved by the company's general meeting of shareholders, A-share class shareholders' meeting and H-share class shareholders' meeting, and can only be formally implemented after being approved, approved or approved by the competent regulatory authorities, and there is uncertainty. The company will continue to promote the relevant work of this transaction after the resumption of trading, and strictly fulfill the information disclosure obligations in accordance with the requirements of relevant laws and regulations.
Guolian Securities was suspended on April 26, and the stock price before the suspension was 10.46 yuan per share, with a total market value of 29.6 billion yuan. On the day of the suspension, brokerage stocks collectively set off a tide of daily limits, Guosheng Financial Holdings, Pacific, Capital Securities, CICC, Jinlong Shares, Zheshang Securities, Founder Securities, China Galaxy and other stocks with the concept of restructuring and mergers and acquisitions have a large daily limit.
On April 26, Guolian Securities' Hong Kong stocks rose sharply, closing at HK$3.69 per share on the same day, an increase of 25.8%. On May 14, the closing price of Guolian Securities' Hong Kong stocks was HK$4.4 per share, an increase of 3.04% on the day. Since April 26, Guolian Securities' Hong Kong stocks have risen by more than 50%.
Implement the integrated development strategy of the Yangtze River Delta to achieve leapfrog development
The background of this major asset restructuring has also been further elaborated in the plan.
According to the plan, the transaction is a merger and reorganization of securities companies, and after the completion of the transaction, the main business of Guolian Securities has not changed. The target company, Minsheng Securities, is a national comprehensive securities company approved by the China Securities Regulatory Commission, with brokerage branches and investment banking business with significant competitive advantages in nearly 30 provinces (including municipalities and autonomous regions) across the country.
After the completion of the transaction, Guolian Securities' investment banking business and securities brokerage business will be significantly improved, and it is committed to achieving the effect of "1+1>2" through the integration of the business of both parties, so as to achieve leapfrog development of listed companies. At the same time, Guolian Securities' total assets, net assets, operating income and net profit will further increase, profitability and anti-risk ability will be improved, and comprehensive competitiveness and sustainable operation ability will be further enhanced.
In terms of the purpose of the transaction, the plan stated that this transaction is conducive to the implementation of the integrated development strategy of the Yangtze River Delta, can help Guolian Securities achieve leapfrog development, and at the same time can give full play to the synergy between Guolian Securities and Minsheng Securities to achieve complementary advantages.
Through this transaction, Guolian Securities will be integrated into a platform for the coordinated development of Wuxi and Shanghai, which is another major measure for Wuxi to integrate into the Yangtze River Delta integration strategy, not only to make full use of Shanghai's financial resources and talent gathering advantages to achieve its own development, but also to give full play to the service function of the financial platform, empower Wuxi's industrial structure upgrading, help Wuxi deeply integrate into the Yangtze River Delta integrated development strategy, better connect with the Yangtze River Delta financial, scientific and technological innovation, industrial resources, and accelerate the optimization of local industrial structure and economic transformation and upgrading.
This transaction can build a large-scale securities company with leading business scale, strong capital strength and large market influence, make full use of Wuxi's industrial advantages and shareholder empowerment, Shanghai's financial resources and talent gathering advantages, realize the expansion of business geographical territory, the sharing of customer and channel resources, the complementarity of business advantages, and achieve synergy in various businesses, so as to achieve leapfrog development and obtain opportunities for development and growth in the increasingly fierce market competition.
Guolian Securities and Minsheng Securities have similar capital strength, but there are still certain limitations in the business access of financial institutions, business qualification application, industry classification evaluation, etc., and it is difficult to give full play to their respective resource advantages. This transaction will promote the optimization and integration of business channels, customer resources and products and services of the two brokerages, complement each other's strong and weak businesses, and give full play to the scale effect, reduce operating costs, improve operational efficiency, and achieve capital-intensive development while enhancing comprehensive capital strength.
However, for the follow-up integration, the plan also makes a risk warning: considering that the follow-up integration involves assets, business, personnel and other aspects, the complexity of the company's internal organizational structure will also increase, which may lead to a long time for various integration measures to achieve the expected results. In addition, securities companies have certain industry particularities and complexities in business integration, or need to go through a long integration process. Therefore, after the completion of this transaction, there may be a risk that the integration of Guolian Securities and Minsheng Securities will not meet expectations.
Editor: Xiao Mo
Review: Muyu
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