Case Study On Backdoor Listing And Returning To Chinese Capital Market Of 360

Since the 1990 s,Chinese companies have started the process of going to overseas capital markets.By listing overseas,these Chinese companies have obtained new financing channels and gained international popularity,collectively named as Chinese-Concept-Stock companies.In recent years,due to various factors such as the differences in corporate cultures at home and abroad,the Crisis of Chinese Concept Stocks,and other factors,Chinese-Concept-Stock companies have encountered problems such as undervaluation and poor liquidity,constraining re-finance in foreign capital markets and sustainable development of corporate business.Many Chinese-Concept-Stock companies have started to go private in order to re-list in the domestic capital market.In the upsurge of the return of Chinese stocks,as a leading company in Chinese Internet security,360 also started the process of privatization and delisting in 2015,and successfully entered the A-share market through backdoor listing in 2018.This article adopts a case study method and selects 360 as the research object to study the process of its return to A-share market through backdoor listing.The decision-making motivation for the choice of its return path,the characteristics of the backdoor listing trading model,and the cost and performance of backdoor listing are also analyzed deeply.This article finds that during the US-listing period of 360,its stock price was undervalued,refinancing was constrained,and the cost of listing maintenance was high.Driven by national policies,the company decided to return to the domestic capital market.In consideration of the return time and the company's control,360 chose to return through backdoor listing.As for the mode of backdoor listing trading,360 adopted a special mode of substantial assets sale+ asset replacement+ stock issuance to purchase assets,which not only helped 360 to pay for shell purchases but also eased financial pressure of 360.Through cost analysis and comparison,this article finds that the cost of 360 backdoor listing is mainly the cost of ownership dilution,but this cost can be mitigated through refinancing.In terms of the performance of backdoor listing,the original shareholders of the company have achieved good results in asset increment,but the loan for privatization has constrained the re-finance of the company and the company's financial problem caused by the redundancy of funds hasn't been solved.Based on the above research results,this article draws the following enlightenment: Chinese-Concept-Stock companies that plan to return should reasonably choose a return path based on their own situation.Secondly,Chinese-Concept-Stock companies that intend to backdoor-list should pay attention to the selection of shell resources and the optimization of the design of the transaction during backdoor listing to ensure the smooth implementation of the backdoor listing program.Finally,Chinese-Concept-Stock companies that intend to backdoor list should attach importance to planning in advance and make good use of funds and strengthen information disclosure on monetary funds.The research and analysis in this article is helpful to enrich the relevant research on the return of Chinese Concept Stocks and backdoor listing.