A Case Study Of WuXi AppTec’s Return To A Shares

Since the 1990 s,due to the many restrictions of China’s capital market,many Chinese companies have gradually begun to choose to go public in the United States in order to seek better development.However,by 2010,due to cultural differences,valuation differences,etc.,Chinese concept stocks have begun to privatize in order to obtain higher valuation levels and wider visibility.However,the return of the Chinese concept stock company is not smooth.From 2000 to now,a total of 9 companies have successfully returned to A shares.Faced with many obstacles on the road to return,many Chinese companies can only be discouraged.In 2018,China’s capital market supported the rapid development of the “Four New Economy” and provided a fast track for A-share IPOs in industries such as biotechnology,cloud computing,artificial intelligence,and high-end manufacturing.In this context,WuXi PharmaTech seized This good opportunity to successfully return to A shares in a "one-three-break" way and this has also received great attention from the capital market.This article takes the case of WuXi PharmaTech’s successful return to A-shares as the research object,and uses case analysis,literature analysis,comparative analysis and other methods to focus on its “one-three-replacement” return method and adopt the “one-three-replacement” approach.In-depth analysis of the causes,effects,uniqueness,and problems.The study found that WuXi PharmaTech’s return to the spin-off market was mainly due to the fact that other routes were blocked and the spin-off was feasible.Through the "one-three-break" approach,the company’s operating performance has been improved,the company’s market value has been improved and the financial pressures in the return process have been effectively alleviated.The reason for this success is due to the uniqueness of the return method,that is,the timing of the spin-off is selected before the privatization and the company is distributed in multiple markets.However,WuXi PharmaTech’s approach also has some problems,including horizontal competition,related party transactions,equity dilution,short-term profitability of the parent company,and complicated procedures and legal proceedings.Based on this,this paper puts forward relevant suggestions: For the Chinese concept stock companies,they should reasonably choose the return method to fully evaluate their own business and the situation of the capital market.for the Chinese concept stock companies that are preparing to adopt the spin-off return,they should give full play to the points.Take advantage of the return and actively solve the problems.For the regulatory layer,on the one hand,it should promote the diversification of the return path of the Chinese concept stocks.On the other hand,it should also be alert to the problems in the return process of the stocks.