Analysis On The Cash-Option System Of Stock-for-stock M&A

Capital market is still developing,mergers and acquisitions are more and more popular.and Stock-for-stock to become the main way of mergers and acquisitions.Cash option system is our own unique system.It is explored out in China's practice of mergers and acquisitions.The cash option system has a legal attribute and also has economic attribute,which is a combination of two attributes.At the legal level it can protect the interests of small and medium shareholders,to provide dissenting shareholders to withdraw the mechanism.At the economic level,it is similar to the put option."Measures for the Administration of the Takeover of Listed Companies(2012)" for the shareholders who in the case of the use of mergers and acquisitions or comprehensive offer to provide the right to withdraw from the cash,to our cash selection system to lay the foundation for the implementation and construction.However,for the cash option system,China's existing laws and regulations have not made clear provisions,only the Shenzhen Stock Exchange promulgated the "cash options investors business operation guide","Shenzhen Securities Exchange listed companies cash selection business guidelines" have the relevant Content.China's cash option system still has many problems and is not conducive to its original pursuit of value,Now the urgent need is to improve and build cash option system.Shareholders repurchase claims is the legal right.In the view of value,it does not conflict with the cash option.They all provide a remedy for the dissenting shareholders,that is,to allow them to withdraw.Also it smooth the progress of Mergers and acquisitions.In the practice,there are cases to use these two systems together.But in essence,both in the scope of application or legal level of the two systems are different.In order tobuild the cash option system better,it is necessary to clarify its existing problems and shortcomings,and compare with Shareholders repurchase claims,in multi-faceted angle to analysis,research,so as to understand the cash option andimprove the cash options system.Which can protect the rights of small shareholders.