The Research On Back-door Listing In A Stock Market For Private Enterprises Of Mainland China Registered And Listed Overseas

As the reform of non-tradable shares progresses, the health condition of A stock market is turning around, combined with the promising macroeconomy prospects and flourishing market performance of the recent two years, which intrigues private enterprises of mainland China registered and listed overseas so much. However, strict supervisions from home and abroad and the competition between different markets for interests from supervising, plus the lack of policy supports, often dashed their hopes of spinning-off back to A stock market.But difficulties can't veil potential demands and prospects. As this paper will analyze, Interchina Holdings Co., Ltd. (0202, HK) is such a rare success, whose subsidiary company, Interchina Water Treatment(Tianjin) Co.,Ltd., will go public in A stock market by the shell company------S*ST Black Dragon.Firstly, this paper gives detailed instructions of "back-door listing" and comparisons with some relevant concepts. Based on the status quo of A stock market and relative policies, the paper contends "back-door listing" is the only feasible way to go public in A stock market for private enterprises of mainland China registered and listed overseas.Secondly, after the instruction of common reasons and ways for "back-door listing", this paper presents specific analysis and deep comments on the case of "Interchina Water Treatment(Tianjin) Co.,Ltd go public by S*ST Black Dragon", pointing out some unique and effective factors that contributed to final success.In conclusion, through study of the case above-mentioned, this paper proved that going public in A stock market by a shell company can benefit private enterprises of mainland China registered and listed overseas in many ways, such as the favorable policies, widening financing channel and the appreciation of RMB, and is therefore very essential for them. If the whole program of back-door listing can be designed properly, including the timing for buyout of the shell company and the skills concerning agreements design, then final success would not just be a dream.