Research On The Financial Performance Of Backdoor Listing Of Berry Genomics

Since the emergence of backdoor listing,many enterprises that can not meet the conditions of IPO have chosen to complete the listing by backdoor listing.At the same time,this method also brings some problems,such as shell resource speculation,shell company’s stock price distortion,and restrictions on the normal functioning of the market.In order to regulate the chaos of the market and curb the speculation of shell resources,the regulatory authorities have issued a number of policies.With the promulgation of the new asset restructuring regulations in September 2016,the difficulty of backdoor listing has increased sharply,and the phenomenon of "fried shell" has been curbed to a certain extent.However,compared with the long-term IPO,backdoor listing still has its unique advantages.In addition,in recent years,with the continuous introduction of new policies to support the development of the gene sequencing industry,the gene sequencing industry has brought unprecedented opportunities.In order to seize the market better,leading companies in gene sequencing industry have chosen to go public.In August 2017,as a leading company in gene sequencing industry,the successful backdoor listing of Berry Genomics has attracted attention from all sides.This paper takes Berry Genomics Shell TianXing Incident as the research object.Firstly,the two parties involved in the case and the trading scheme are introduced,and the motivation of this backdoor listing transaction is deeply analyzed from the perspective of Berry Genomics and TianXing.Secondly,in the study of short-term and long-term financial performance of Berry Genomics’ backdoor listing,the event study method,financial index analysis method and EVA analysis method are used respectively.In terms of short-term performance,after the news of backdoor listing was released,the market gave a strong positive response,which was reflected in the continuous rise of stocks.The backdoor listing increased the value of the company and brought positive wealth effects to shareholders.In terms of long-term performance,after backdoor listing,Berry Genomics’ profitability and development ability were good,and EVA was greater than 0 and obvious.As a result,the company’s long-term performance has improved.Generally speaking,the successful listing of Berry Genomics has brought positive impact to both sides of the transaction and achieved a win-win situation.Finally,it summarizes and analyses the Enlightenment of Berry Genomics’ case of backdoor listing,such as choosing the right way of listing,grasping the policy,defining the strategic significance,choosing the appropriate shell resources and establishing reasonable performance commitments,so as to provide reference and inspiration for enterprises that are looking forward to backdoor listing.