A Case Study Of SAF Ternary Reorganization

In recent years,the pace of state-owned enterprises’ state-owned assets reform has been accelerating.Based on the long-term and sound development of state-owned enterprises’ state-owned assets,the state has increased the support of capital market for the operation of state-owned enterprises,deepening the reform of state-owned enterprises,and the securitization of state-owned assets of state-owned enterprises is also in full swing.In addition to the IPO with proper procedures,complicated procedures and slow auditing,there are also backdoor listing with strict auditing of asset qualification.In order to avoid strict asset qualification examination,many enterprises use different schemes to bypass the recognition of backdoor by the regulators.In response to the growing phenomenon and the prevalence of speculation,in order to try to avoid the risk of such enterprise behavior on the immature Chinese capital market,in 2016,the CSRC promulgated the measures for the restructuring of major assets of listed companies(hereinafter referred to as the "restructuring measures" or the new regulations on backdoor),which uses a stricter regulatory environment to crack down on the backdoor behavior of enterprises.The main research object of this paper,SAF,chooses cross-border M&A of AVA to seek a new profit direction,so as to get rid of the delisting risk brought by its operating loss for two consecutive years.Shanghai Huayi Group Corporation Limited,the former controlling shareholder of SAF,signed a share transfer agreement with China Cultural Development Group to change the control right through share transfer,so as to find a new development direction with the financial and technical support of China Cultural Development Group and AVA to reduce the impact of the industry’s downturn.Since the joint release of the framework agreement on major asset restructuring,SAF has received many inquiries and revised the restructuring plan,which will finally succeed.This paper mainly analyzes the three-way restructuring mode used in the case of merger and acquisition of SAF,and analyzes the application of the three-way restructuring mode in enterprise merger and acquisition through three aspects of motivation,risk and market performance.This paper will refer to the existing research results,combined with the specific content of the case of three element reorganization of SAF,and analyze the motivation,risk and market performance of SAF reorganization around the specific transaction mode,financial data and market reaction in the case.For the analysis of motivation,the main reason is that SAF’s own fluorine chemical industry continues to lose money and needs to inject new growth industries to maintain enterprise life.This year is the implementation period of the state-owned assets reform policy.This asset restructuring is a representative attempt of the state-owned assets reform.In this paper,the financial data of SAF in recent years are used to analyze its subsequent profitability.It is found that the original profit of SAF’s fluorine chemical industry is weak,which may be stripped in the future,and the dual main business model is difficult to balance.Collect the stock data of SAF for regression analysis,calculate the excess return rate and cumulative excess return rate in the event window period of SAF’s resumption and first buyback,and make a quantitative analysis of its market performance after the three-way restructuring,and find that the three-way restructuring of SAF has less pulling power on the stock price.This paper summarizes the successful experience of the merger and reorganization of SAF.The conclusion of this paper is based on the detailed text and data analysis,which can be used as a reference for the merger and reorganization of enterprises and the securitization of state-owned assets,Supplement and enrich the research results,summarize the key points of success of SAF,and focus on how the regulators divide their practices,weigh the similar backdoor restructuring of other enterprises according to their subsequent business performance,refine and improve the relevant legal supervision,which is of research and practical significance.