2). Red chip stock
Red chip stock refers to the stocks of a company incorporated and listed in Hong Kong with controlling Chinese shareholders. Its operation process is as follows:
• N domestic shareholders (of domestic corporation) set up an overseas corporation.
• Transfer the domestic stock holdings to the overseas.
• The overseas corporation holds the domestic one.
• The overseas corporation applies for issuing stocks overseas.
Listing by red chip stocks possesses the characteristics as follows:
• It's needed to set up an overseas holding company that is the one to requisition listing. Its domestic operation is limited within the domestic laws; however, its listing process follows the laws of locations of listing and register.
• Listing auditing doesn't need CSRC approval, hence save lots of time.
• Stocks can completely circulate, which enables shareholders convert its assets into securities holdings.
• It's simple to finance and refinance that only need general meeting's approval.
Consequently, Non-governmental enterprises prefer this listing way, which only has one problem to solve---transfer the domestic equities to overseas corporation.
• Back door listing
A strategy of going public used by a company that fails to meet the criteria for listing on
a stock exchange. To get onto the exchange, the company desiring to go public acquires an already-listed company.
• Private offerings
• Private offerings scope:
Introduce into strategic investors before going public
Equities financing of enterprises in unique industry, having well performed work team, and developing swift.
M&A financing
Privately offered fund
• Working out the plan of private offering financing:
Deciding the amount of private offerings
Choosing target clients
The process of private offerings
• Estimate of private offering enterprises
Confirm enterprises' value.
Price fixing strategy of private offerings
Being coordinated by agency
• Compiling prospectus
Industry analysis
Analysis of enterprise operation and financial affairs
Enterprise strategy
Introductions of investment projects
Basis of evaluation and price
Venture factors
• Recommendations and road shows
Corporation image packaging
Arrangement of road show
Introducing into institutional investors
• Advisors on listing:
Providing companies desiring to go public with listing plan designs (including IPO or going public through buying a shell) and comprehensive solving programs of stockbroker recommendations, financing services
• Enterprise joint-stock system reconstruction, including assets definition, equity plan design, corporate governance completion, business re-integration, provide assistance to commercial industrial registration, and so on.
• Choosing and coordination of sponsors and other agencies.
• Providing advice for presented documents to clients from the parties involved.
• Providing advice for securities categories, quantities, price, fee, time and so on
• Requisitioning securities issuance and listing for clients
• Assisting clients' public relations.
• Providing advice for raising money for investment projects
• Communicating with agents and give advice on audit reports, assets estimate reports, profit anticipation, memorandums, and so on behalf of clients.
• Providing advice on terms and conditions of prospectuses.
• Providing advice for clients' other demands.
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