Recently, A-share spin off listing has become hot. On March 16, Tangshan Sanyou Chemical Industries Co.Ltd(600409) announced that the company was preparing to spin off its holding subsidiary silicon company to be listed on the domestic stock exchange; On March 15, Sichuan Hebang Biotechnology Co.Ltd(603077) , Guangdong Dongfang Precision Science & Technology Co.Ltd(002611) respectively issued plans for the listing of spin off subsidiaries.
According to the reporter’s combing, as of March 17, a total of 13 companies have split their subsidiaries and listed, of which 4 subsidiaries have landed A-Shares this year. In addition, among the companies to be spun off, zhaoxun media has completed the issuance and is waiting for listing; The registration of Zhongke Jiangnan has come into effect and has not yet been issued. There are 12 listed companies waiting in line for review.
more than 60 companies are in the process of “dismantling a”
Spin off and listing ushered in a small climax. According to the reporter’s incomplete statistics, as of March 17, at least nine A-share listed companies have issued spin off plans or suggestive announcements this year. At present, more than 60 companies have thrown out the spin off plan but the listing application of their subsidiaries has not passed the examination.
“The trend of spin off listing is an inevitable situation when China’s capital market develops to a certain stage.” Zhang Lei, member of Huatai joint securities Executive Committee, said in an interview with reporters that after years of development, listed companies have significantly improved their industry status and enterprise scale. There may be several subdivided industries under a large company, and even there will be large differences between industries. Spin off listing is a very important means to solve the above problems.
Bank Of China Limited(601988) Research Institute postdoctoral Wang Huiqing said in an interview with reporters that on the one hand, with the reform of the registration system, the “shell” value of listed companies has decreased, and a series of policies regulating spin off and listing have been issued one after another, and the motivation of spin off and listing of listed companies has returned to rationality; On the other hand, under the guidance of the national innovation driven development strategy, a large number of listed companies actively develop “specialized, special and new” businesses, and the demand for separating such high growth businesses and listing them separately is increasing.
From the perspective of the listing sector, most of the listed companies take the science and innovation board and the gem as the destinations for spin off listing. According to statistics, as of the closing on March 17, the total market value of 13 companies reached 207939 billion yuan. From the performance after listing, the share prices of 11 companies rose on the first day of listing and 2 broke on the first day of listing. If we observe the rise and fall on the 5th day after listing, only one of the 13 companies has a rise in share price.
“The rise and fall of the share price after the spin off does not explain anything, because the rise and fall are relative to the issue pricing.” Zhang Lei believes that there are certain laws in the development of enterprises, and it is necessary to observe the effectiveness of their valuation through a period of operation. In general, the valuation of spin off listed enterprises is closely related to fundamentals, industry status, future development strategy, core technology and core talents.
In addition to successfully landing A-Shares to complete the spin off, some companies also terminated the spin off plan for various reasons. According to the reporter’s incomplete statistics, as of March 17, a total of 11 listed companies have terminated the spin off plan, including non-compliance with the conditions for spin off listing, decline in the performance of subsidiaries, horizontal competition problems, changes in the capital market environment, etc.
the industry believes that the spin off needs to achieve three objectives
On March 9, the listing plan of a listed company to spin off its subsidiaries attracted market attention as soon as it was thrown out. Because the company just successfully completed a spin off listing in February, the subsidiary successfully landed in a shares.
“Spin off and listing is a capital operation mode that enlivens the stock in the international market and optimizes the increment. It can help listed companies focus on their core business and improve their operation efficiency. Subsidiaries can obtain financing support with the help of the capital market.” Wang Huiqing said that starting the spin off listing should be based on the actual needs of the company’s development. For listed companies, spin off listing should meet the strategic development needs of “Refocusing” of the parent company.
“The fundamental purpose of spin off and listing is to integrate business development, optimize resource allocation, enhance the industrial competitiveness of parent and subsidiary companies, and make the financing structure of enterprise groups more diversified, the debt structure more reasonable and the financing quality guaranteed.” Wang Huiqing said.
Zhang Lei believes that the success of a company’s spin off and listing can be judged from three aspects: first, the company can get enough funds at the lowest cost; Second, after the split, the total market value of the two companies exceeds the market value of the original company; Third, the company’s related industries have been developed, and the management team and employees have a sense of gain. At the same time, the incentive paths between different industries within the enterprise have been clarified, providing the same capital conditions for the development of different business sectors.
