Strategy And Effect Analysis Of H-share Company's Privatization

For many companies,going public is an important way to obtain a stable source of funding and increase brand awareness.However,in the beginning,because of the high barriers to entry and the long waiting time for listing in China's domestic capital market,many mainland Chinese companies chose to go public on the more mature and mature Hong Kong market.Now,with the continuous improvement of China's domestic capital market and the successive introduction of national policies to support the development of enterprises,the mainland market environment is getting better and better.However,the Hong Kong market in China is performing poorly,with stock market downturns and poor stock liquidity.Compared with the capital market in mainland China,the valuation of the same company is much higher than that of the Hong Kong market in China.The company needs to bear huge listing and maintenance costs.This has caused many H-share companies to lose confidence in the Hong Kong market in China.Since 2015,there has been a fever of privatization and delisting of H-share companies.Many H-share companies that once actively went to the Hong Kong market in China have chosen to delist.Many successful cases have emerged in these delisted H-share companies.After the company completed the privatization and delisting,the company's value has greatly increased,and its performance has improved significantly compared with before delisting.Therefore,it has attracted the attention of many experts and scholars.On January 25,2019,BDT successfully delisted from the Hong Kong Stock Exchange in China.Due to the continued downturn in the Hong Kong market in China,the company's share price is undervalued.Nowadays,the domestic capital market has gradually relaxed the requirements for the company's listing conditions.Moreover,since the 19 th National Congress of the Communist Party of China,the country has further strengthened its policy support for technological innovation enterprises in order to turn China into a powerful country in science and technology as soon as possible.Not only that,in order to promote the rapid development of technological innovation enterprises,a science and technology innovation board has also been set up.These policies make BDT see the hope of rebirth.In 2018,in order to enhance corporate value,improve the current situation of insufficient production capacity and insufficient capital investment,get rid of the constraints of the identity oflisted companies,and realize the company's strategic transformation,etc.,under the offer of Jetta Semiconductor,it decided to withdraw from the Hong Kong market in China by privatization.This decision will provide an opportunity for it to seek better development in the mainland capital market.From Jetta Semiconductor's privatization offer to BDT to the final signing of the privatization delisting agreement,BDT only spent less than three months.Compared with other companies that took several years to reach a privatization delisting agreement,the efficiency of this privatization delisting is very high.And its high efficiency has a lot to do with the privatization delisting strategy it adopts.And the delisting of privatization has also brought many positive effects for BDT.Therefore,this article takes BDT's privatization and delisting as a case study.This article uses a combination of theory and cases to study the privatization and delisting of H-share companies,specifically divided into the following sections.The first part focuses on the research background,significance,research ideas and methods in this paper.The second part mainly related theory of listing private retreat city,which lays a theoretical foundation for the case analysis of BDT companies later.The third part first introduces the basic situation of BDT company;secondly,it explains the motivation of BDT company's privatization and delisting;finally,it reviews the whole process of BDT company's privatization and delisting.The fourth part is the strategy and effect analysis of BDT's privatization and delisting.There are many uncertain factors in privatization and delisting.The risk of privatization and delisting is relatively high.Once a failure occurs,the enterprise will fall into a more embarrassing situation.Therefore,the privatization delisting strategy is very critical.The BDT company's privatization and delisting was very successful,so according to the BDT company's privatization process,it summarized its main strategies implemented in the privatization and delisting process,including accurately selecting the timing of privatization and delisting,and selecting the appropriate privatization and delisting Market development methods,setting reasonable purchase prices,choosing reliable partners,etc.Finally,the effects of privatization and delisting are also analyzed,mainly involving market effects,financial effects,and synergy effects.The fifth part draws relevant conclusions based on the case study and sums up the experience on this basis,and puts forward some concrete and feasible suggestions for the privatization and delisting of H-share companies.There are relatively few studies on the privatization and delisting of listedcompanies in China,especially the research on privatization and delisting strategies.Moreover,most of the existing research focuses on the research on the privatization and delisting of U.S.-China stocks,and few scholars are concerned about the privatization and delisting of H-share companies.Therefore,this article takes the privatization and delisting of H-share companies as the background and selects BDT as a case to study the strategies and effects of privatization and delisting,which has certain theoretical significance.Not only that,as the number of H-share company privatization and delisting cases increases,this article will provide a certain amount of H-share companies that are undergoing or planning to privatize delisting through specific analysis of BDT's privatization delisting strategy and effects Experience and suggestions to help them deepen their understanding of privatization delisting and clarify the risks of privatization delisting.After properly measuring the costs and benefits of privatization delisting,a privatization delisting strategy should be formulated in accordance with the company's actual situation,which can increase the likelihood of privatization delisting success.