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new rules from the china securities regulatory commission! a great era of mergers and acquisitions and restructuring of listed companies may begin!

2024-09-26

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text/wutong brothers

on september 24, the china securities regulatory commission officially issued the "opinions on deepening the reform of the listed company merger and acquisition market", which will further strengthen the resource allocation function of mergers and acquisitions.give full play to the main channel role of capital market in corporate mergers and acquisitions and restructuring, key contents include:

1、support the science and technology innovation board and growth enterprise market listed companies to acquire upstream and downstream assets in the industrial chain and enhance the attributes of "hard technology" and "three creations and four innovations".supporting listed companies with standardized operationscarry out cross-industry mergers and acquisitions that conform to business logic in response to demands such as industrial transformation and upgrading and seeking a second growth curve, and accelerate the pace of transformation to new quality productivity. support listed companies to combine their own industrial development needs, without affecting their sustainable operating capabilities and setting up relevant arrangements to protect the interests of small and medium-sized investors.acquisition of high-quality unprofitable assets that can help to strengthen the supply chain and improve key technology levels. implement a "reverse linkage" between the investment period of private equity funds and the lock-up period of shares acquired through restructuring.promote the virtuous cycle of "fund raising, investment, management and exit".

2. encourage and guide leading listed companies to focus on their core businesses and increase the integration of listed companies in the industrial chain.improve policy regulations such as share lock-up periods, and support mergers and acquisitions within the same industry and upstream and downstream between listed companies under different control, as well as mergers and acquisitions between listed companies under the same control.support listed companies in traditional industries to acquire assets in the same industry or upstream and downstream, increase resource integration, and reasonably improve industry concentration. support private equity investment funds to legally acquire listed companies for the purpose of promoting industrial integration. support listed companies in the shanghai, shenzhen and beijing stock exchanges to carry out multi-level cooperation and help build characteristic industrial clusters.

3. give full play to the role of the market in price discovery and competitive negotiation.support transaction parties to negotiate and determine transaction prices based on diversified valuation methods such as asset-based method, income method, and market method.comprehensively consider the target asset operating model, r&d investment, performance growth, comparable companies in the same industry and comparable transaction pricing, and evaluate the fairness of the m&a target pricing from multiple angles.when a listed company purchases assets from a third party, the two parties to the transaction can negotiate independently whether to set up a commitment arrangement.in line with the laws of industrial development, we will appropriately increase tolerance for intra-industry competition and related transactions resulting from mergers and acquisitions and restructuring.