Case Analysis Of The Equity Carve-outs About CSPC

Prior to the 1980s,in order to obtain higher economic benefits,large foreign companies quickly realize the diversification of enterprises through mergers and acquisitions.However,diversified operations also brought a series of negative effects.Therefore,the modest and reasonable strategic contraction of spin-offs has begun to attract the attention of some large enterprises.In the 1980 s and 1990 s,the method of asset reorganization,such as spin-off and listing,became popular in the United States.Due to the earlier development of foreign capital markets and the relatively sound rules and systems,investors in foreign capital markets have a strong ability to accept the asset reorganization method of spin-offs and listings.Therefore,companies continue to diversify through spin-offs and listings.With the enrichment of practical experience,foreign theoretical research on spin-offs has become more mature.Different from the situation in foreign capital markets,the research on spin-offs and listings in China's capital market started late,and due to the imperfection of China's capital market,Chinese companies have been on the wait-and-see status.It wasn't until 2000 that Tongrentang,a spin-off subsidiary of Tongrentang,successfully went public,which opened the prelude to a domestic spin-off.With the continuous closeness of the domestic and foreign capital markets,and the continuous improvement and development of China's capital market,domestic companies are increasingly familiar with the spin-off and listing model,and spin-offs have become an important way of asset reorganization in China.In 2014,China's capital market ushered in a wave of spin-offs and listings,but it is still dominated by domestic listed companies' spin-off subsidiaries or partial assets listed overseas,while overseas listed companies' spin-off subsidiaries are rarely listed on China's main board market.Domestic scholars also have rich theoretical researches on the spin-off of subsidiaries of domestic listed companies and their overseas listings,but the research on the spin-off of subsidiaries of overseas listed companies on the main board of China's A shares is relatively scarce.CSPC is an overseas spin-off company that is listed in China.As China's first Hong Kong-listed pharmaceutical company stock,its “red chip + A + new third board” capital layout has great research significance.Therefore,this article combined with existing theories and adopted a case study method to analyze the motivation and economic consequences of the spin-off and listing of CSPC.First,the related concepts of spin-off and listing are explained theoretically,including the definition of spin-off and listing,the type of spin-off and listing,the mode of spin-off and listing,and the reasons for the spin-off and listing.Second,The company's relevant situation was introduced,the differences between the two spin-offs were explained,and the process of the two spin-offs was described in detail.Finally,according to the existing theoretical basis and the case itself,the CSPC's motives and economic consequences of the spin-off have been comprehensively analyzed and researched.Based on the analysis results,the research conclusions of this article are summarized,and suggestions are made to other companies attempting to spin-off.Through the analysis of the two spin-off listing cases of CSPC,this article draws the following research conclusions: first,the spin-off and listing will promote the value of the enterprise to a certain extent;Second,the spin-off and listing can broaden the financing channels;Third,the spin-off and listing will stimulate management's enthusiasm;Fourth,the spin-off and listing will enhance the core competitiveness of enterprises.Based on this,the following research implications are obtained: first,the adoption of an appropriate strategy is the guarantee for successful spin-off of the listing;Second,the spin-off of the listing should choose the high-quality assets of the company in the development stage;Third,the listing process should be properly controlled and selected.Fourth,attention should be paid to the development capabilities of the parent and subsidiary after the spin-off.