The Whole Listing Of CITIC Limited Impacts On Its Cost Of Capital

As a way for corporations to listing,the important role of whole listing is to broaden the financing channels of listed corporations.And the cost of capital is one of the key factors to influence the financing decision of corporations.The influences in the cost of capital which caused by whole listing will directly affect the expectation of corporations before whole listing and the financing decision after whole listing.On March 26,2014,the board of directors of the CITIC Pacific co.,Ltd.(CITIC Pacific)issued �the framework agreement about transferring the 100% of the issued shares of the China CITIC co.,Ltd.�.The announcement suggests that the CITIC Pacific is negotiating about buying the 100% of the issued shares of the China CITIC co.,Ltd.(CITIC Limited)with the China CITIC Group Co.,Ltd.(CITIC Group)and the Peking CITIC Enterprise Management co.,Ltd.(CITIC Enterprise Management).And the three corporations have signed a framework agreement for the potential acquisition.On April 16,the CITIC Pacific and the CITIC Group formally signed a transferring shares agreement that the CITIC Pacific buys the 100% of the issued shares of the CITIC Limited at the price of 226.9 billion Yuan.On June 3,the special meeting of the shareholders of CITIC Pacific passed the transferring shares agreement.On August 25,CITIC Pacific completed the acquisition and renamed as China CITIC co.,Ltd..As a large state owned enterprises which whole listed first in Hong Kong,the listing experience of CITIC Limited has important reference significance for other large state owned enterprises to explore the way of whole listing.The paper gives the example of CITIC Limited whole listed in Hong Kong by CITIC Pacific,compares the differences between the domestic securities market and the foreign securities market,analyses the motivation of CITIC Limited choosing Hong Kong as the place of whole listing,reviews the process of its whole listing,tests the influences in the cost of capital which caused by whole listing in Hong Kong,and try to explain the reason.