Research On Belle International's Motives Of Delisting

In today's increasingly competitive capital market,listing has always been the goal that many companies strive for.However,in recent years,there has been a different voice in the capital market that some companies decided to delist voluntarily.This kind of delisting is gradually seen as the manifestation of the maturity of the capital market.PetroChina and Sinopec have set off a prelude to the privatization of listed companies in mainland China since 2005.And in 2011,some Chinese companies listed in the US decided to delist.There were also a number of high-quality enterprises among them.What's even more remarkable is that in July in 2017,Belle International,a company called ‘king of shoes' in China,delisted with a valuation of HK$53.1 billion through a privatization plan.This transaction broke the record of the largest privatization of Hong Kong Exchange.Based on the relevant research of domestic and foreign scholars,this paper will focus on the case of Belle International's delisting.Firstly,the background of Belle International's delisting,the basic information of Belle International,the whole process of privatization transaction and the development of Belle International after delisting will be introduced in great detail.Secondly,analyzing the motivations of the delisting is the most significant part in this paper.Combined with the theory and the actual situation of the company,this paper believes that Belle International's motives for delisting are mainly affected by three factors: financial,strategic and controlling factors.Financial motivation is one of the important reasons that affect the delisting.It mainly explains the performance of the industry and the impact of the internal financial situation of the company on the delisting.Affected by the booming development of Internet e-commerce and foreign brands,the traditional retail industry and footwear industry are struggling in China with poor performance.Belle International's financial situation has deteriorated in recent years with weakening growth ability,profitability and operational capability.Strategic motivation is another important cause of delisting,including the transformation of business strategy and the re-layout of capital strategy.The development of its footwear business and e-commerce business are not optimistic,resulting in an urgent need for transformation.At the same time,Belle International's performance in Hong Kong's capital market was not good,and shareholders' wealth was shrinking.In order to achieve better development,Belle International has the capital demand for overall re-listing or spin-off.In addition,in terms of the controlling party's motives,the founder of the group has been too senior to continue to guide the company's strategic transformation,and the strength of the potential controlling shareholder has also promoted the process of Belle International's delisting.Finally,by summarizing Belle International's delisting case this paper intends to have an expectation of the future development of Belle International.Moreover,some enlightenment is ecpected to be given for the footwear retailers and other listed companies planning to delist,combining with the experience of Belle International.