Taiwan-funded Enterprises Overseas Privatization Back To The Listing Listing Of Research

This research is to investigate the trend of overseas Taiwan-funded enterprises' privatization and going back to list on Taiwan Stock Exchange. Since Lehman Brothers bankruptcy last year, the financial tsunami swept across the global capital markets quickly. The valuation of listed companies is at a historically low level, and this is the major driving forces for the privatization of listed companies. One the other hand, with more concentrated shareholdings and fewer shareholders after privatization, a small number of people may earn more annual dividends. Except for the substantial increase in profit to shareholders, the autonomy and flexibility of reorganization and re-listing are enhanced. Therefore, it becomes the way out for most underestimated listed companies. After Taiwan's 520 election, the policy makers not only carry out the exception of taxes and opening up policies, but also revise loads of restrictions on Taiwan investment to the mainland, which helps Taiwan enterprises find out another way to operate and expand in Greater China region. This research summaries and explores the common models and strategies for listed companies to delist on the current capital marke, and illustrates the possible ways for overseas Taiwan-funded enterprises to list on Taiwan Stock Exchange. It finally uses the privatization of Want Want Holdings in Singapore, re-listing in Hong Kong and TDR issue in Taiwan as the empirical case study. We can discover the market value of Want Want Holdings was extremely increased after the re-listing from analyzing the market value in the two stock markets. Correspondingly, we believe Delta, which is carrying out the privatization in Hong Kong stock market, will get higher P/E ration if it re-list on Taiwan Stock Exchange. In addition this study also investigates the companies announced to carry out privatization in the past, and summarizes their characteristics: if the price-to-book ratio of a listed company is lower than 1 (reflecting the share price is far below net asset value per share), together with the high cash ratio per share, then the possibility of privatization of the listed company will be a higher in the future.With low refinancing cost, high liquidity and high price earnings ratio (lower than the A shares, higher than Hong Kong shares) we believe the current Taiwan capital market would be the preferred re-listing place for the overseas Taiwan-funded enterprises after the privatization.