The Separating Plan Of Zhong WuGaoXin Material Co.,Ltd

As one of the companies whose stocks are exchanged in ShenZhen Stock Exchange, ZhongWuGoXin Material Co.,Ltd (ZWGX)was formed because of reforming of the administration system of Chinese colored metal industry. For the administrative measures being far more than marketable measures in the process of forming, both the structure of assets and capitalization of corporation are full colored by administrative behaviors. The administrative measures bring the company into many problems: capital is running at a low level of efficiency; management is at a state of confusion; trades between affiliated enterprises produce legal risk; ability of refinancing and ability of durative development are serious weakened and so on. Generally, the purpose of reforming is not reached, the worse is the state of company and relative companies are worse after recombine.For these problems, companies that relate to ZWGX have constituted a research group to resolve them; I luckily enough attended the activities of investigation and research as a member of the group. The data and information that were acquired in those activities is stability base of the separating plan.We discuss style, types and latest trend of assets recombination in china, also research the theory of company separating and "small capitalization increment phenomenon" which is especial in Chinese stock market in this article. Then we start with analyzing of the structure of assets and capitalization of ZWGX, and study feasibility and necessary of separating plan carefully. Submitting to thepurpose of increasing fortune of stockholder and principle of innovating thinking, we designed a further recombine plan, which will bring ZWGX out its problems. Differing to others, this plan doesn't adopt the uniting mode but separating mode. Taking proportion of capital stock of Zigong Cemented Carbide Co.Ltd and Zhuzhou Cemented Carbide Group as base of separating plan, we separate the ZWGX into two small capitalization companies. Thus, according to "small capitalization increment phenomenon" which is especially in stock market of china, the plan will increase total value of capital stock of ZWGX.Thus, plan will help we reach the purpose of increasing fortune of stockholder, at the same time, resolve all the problems above, also, the plan accord with legal request. If this plan comes into truth, it will be a great innovation, and it also offers a new mode to those companies that have similarity problems with ZWGX.