Analysis Of The Motivations And Effects Of Red Chip Companies Returning To A-share CDR Listin

The overseas investment environment for red-chip companies further deteriorated in2020 when the U.S.Securities and Exchange Commission(SEC)passed the Foreign Company Accountability Act,under which the SEC has the authority to prohibit the shares of the company from trading in the U.S.stock market.At the same time,the domestic capital market has been gradually improved,and a group of high-quality red-chip enterprises can offer depositary receipts in the country to achieve development with the help of the domestic capital market according to "Certain Proposals on Conducting Pilot Business of Domestic Offering of Shares or Depositary Receipts by Innovative Enterprises" issued by the SEC in2018.In this context,this thesis selects the case of CDR listing of Nine as the main subject of study to investigate the issues related to the return of red-chip enterprises to listing,which is conducive to promoting the red-chip enterprises to achieve domestic listing more smoothly.Since the return of red-chip enterprises to A-share listing is complicated and there are few related studies,this thesis discusses the internal and external motivations for the return of red-chip enterprises based on enterprise valuation theory,familiarity preference hypothesis and regulatory avoidance theory,and compares and analyzes the traditional path of red-chip enterprises with the innovative path of CDR listing.In the listing case study section,we analyze the motivation and process of choosing CDR to return and its financial performance,short-term market effect and listing financial effect after returning to A-share listing,and summarize the possible risks and economic consequences associated with the return of red-chip companies to A-share CDR listing.After in-depth analysis and discussion,this thesis provides theoretical support for the return of red chip enterprises to A-share CDR listing and analyzes the practical operation of the return of red chip enterprises to A-share CDR listing,providing useful reference for future return of red chip enterprises to A-share CDR listing.The research results show that CDR listing has the advantages of short time consumption and avoiding the dismantling of VIE structure compared with the traditional return path such as IPO,so for red-chip enterprises,they should adopt the CDR return method for listing without dismantling the VIE structure according to the actual situation;and for the regulatory authorities,they should strictly improve the legal regulations and system design related to the listing of red-chip enterprises and add For the regulatory authorities,they should also strictly improve the legal regulations and system design related to the listing of red-chip enterprises,add a two-way conversion mechanism and make corresponding arrangements for enterprises listed on CDR before delisting,in order to protect the relevant rights and interests of investors.