Study On The Path And Effects Of The Re-listing Of Delisted Companies

As an important part of the delisting system,the relisting system provides institutional arrangements for delisted companies that have restored their ability to continue as a going concern and have sound corporate governance structures to return to the A-share market.in December 2012,the Shanghai and Shenzhen Stock exchanges promulgated the Implementation Measures for the Relisting of Delisted Companies,which for the first time provided corresponding rules for the relisting of delisted companies.with the development of the capital market,the Implementation Measures were They were amended in 2013,2015,2018 and 2020.In terms of the practice of the re-listing regime,only three companies in China’s capital market have achieved re-listing after delisting,namely Chang Hang Oil Transport,Erzhong Heavy and Hui Lyu Ecological Technology Groups.Its’ predecessor,Huaxin,was delisted due to continuous losses and was relisted on the Shenzhen Stock Exchange on 17 November 2021 after implementing a series of reorganisation programmes.Hui Lyu Ecological Technology Groups is the first company to be relisted after the enactment of the latest regulations on delisting in2020,and the first private company to achieve relisting in the history of A-shares.The relisting of Hui Lyu Ecological Technology Groups has further enriched the practice of China’s relisting system and has brought confidence to delisted companies to return to the capital market,and its successful experience is worth learning from.This article takes Hui Lyu Ecological Technology Groups as the example of study,and uses the case study method and event study method to examine the reasons for the delisting of Hui Lyu Ecological Technology Groups’ predecessor,Huaxin,to further analyse how it solved its own problems to achieve a relisting,and to analyse the effect of its relisting.First,an overview of relevant studies on delisting and relisting is provided,followed by a review of the changes and practices of China’s delisting and relisting systems,highlighting the differences between this case study and previous cases.The case is then introduced in terms of basic company information,reasons and process of delisting,and further through the case study section,the problems faced by companies after delisting are sorted out and the path and effects of relisting of Hui Lyu Ecological Technology Groups are analyzed.This article finds that Hui Lyu Ecological Technology Groups mainly faced problems such as stagnation of its main business,a large debt burden and inconsistency between outstanding and non-marketable shareholders after delisting,and gradually recovered its operating capacity through a targeted problem-solving approach of "equity transfer without compensation + asset restructuring + debt adjustment + shareholding reform".The Company has gradually recovered its operating capacity and met the requirements for re-listing.After relisting,the financial performance of the company needs to be further verified due to the macro environment,but the non-financial performance of the company has improved significantly.Finally,offers suggestions and insights for the three parties,the enterprises to be re-listed,the regulators and the investors.