The Research Of Listed Company Initiative Withdrawal From Securities Market

The listing status in our country is of scarce resources,so the company rarely give up hislisting status.However, Sinopec, Petro-China, Aluminum withdraw from the securities marketby tender offer or merger of the company during2005and2006,that can be described as abreakthrough in the history of China’s securities market.Followed by a period of time, inChina no longer listed company voluntarily delist, the question about taking the initiative towithdraw from the market gradually fades from view. With the practice of Alibaba B2B,Shanda and Little Sheep going private, as well as speculation about their return to theA-share market, listed companies’ initiative withdrawal from the market once again cause theconcern.Delisting system is the key to maintain the vitality of the market and optimize resourceallocation. Delisting system should contain two aspects:proactive delisting and compulsorywithdrawal. For businesses, the stock market should be a two-way street,other than a one-waystreet.The establishment of proactive delisting system is the manifestation of the law‘s respecton companies’ own decision, which can improve the company’s enthusiasm.At the same time,the system also should focus on protecting the interests of minority shareholders. On the basisof theoretical analysis of proactive delisting system,the paper introduces the rules in Taiwan,Hong Kong, the United States,then analyzes the practice and current system of the proactivedelisting in our country.In the end,the paper give some suggestion about the proactive system.Structure of this article, in addition to the introduction, the body part is divided into thefollowing parts:The first part introduces basic theory on withdrawal of listing.Define the concept ofwithdrawal of listing,reveal the characteristics of withdrawal of listing and analyze the motionof listed companies’s withdrawal of listing.The second part analyzes the value of the system of withdrawal of listing-efficiency andfair. By withdrawal of listing companies can achieve long-term development strategy,reducing the company’s operating costs; listed companies take the initiative to withdraw fromthe market can increase the possibility of other listed companies financing;the shareholderscan gain premium. While the system of delisting must focus on protecting the minorityshareholder for their disadvantaged position and the importance of investors in the securitiesmarket. The third part describes the system of proactive delisting in China, Hong Kong,Taiwan and the United States,including the path,the procedure.Particularly, introduces theprotection of minority shareholders by judicial review in America.The fourth part introduces the problems in the cases of Sinopec, Petro-China, Aluminumand the status and defects of the system of withdrawal of listing in China. Sinopec,PetroChina, Aluminum privatization directly promote the development of China’s proactivedelisting system, but the rules are fragmented and the legal hierarchy is not high, and have notformed a complete system. The system can not be effective protection of minorityshareholders.The fifth part is about some suggestion about the procedure of withdrawal of listing,theestablishment of the system and rules of protecting the minority shareholder.