Raise 10 billion yuan with clear purpose, Guotai Junan (601211.SH) and Haitong (600837.SH) merger and reorganization disclosed more details.

According to the information obtained, on the evening of November 21, Guotai Junan (601211.SH) and Haitong (600837.SH) jointly issued a letter to shareholders on the Hong Kong Stock Exchange and a restructuring report (draft) on the Shanghai Stock Exchange, disclosing more details of the share swap and absorption merger. Under the transaction plan, Guotai Junan will issue A-shares to all A-share shareholders of Haitong at an exchange price of 13.83 yuan per share; at the same time, H-shares will be issued to all H-share shareholders of Haitong at an exchange price of 7.73 Hong Kong dollars per share (based on the average trading price of H shares in the 60 trading days prior to the pricing reference date). The exchange ratio is 1:0.62, meaning that each share of Haitong A-shares or H-shares can be exchanged for 0.62 shares of Guotai Junan A-shares or H-shares. With more details being finalized, this largest A+H dual-listed market absorption merger in the history of the Chinese capital market, and the largest integration case of A+H listed securities firms, is accelerating. Reshaping the securities competitive landscape, creating a world-class investment bank Guotai Junan Securities and Haitong are both one of the oldest and largest comprehensive securities companies in China, successful in overcoming all stages and cycles of development in the Chinese capital market. This transaction is undoubtedly a strong combination that will go down in the history of the capital market. While the two companies complete the merger, the post-merger company's functional positioning will be further strengthened. In addition to a significant increase in capital and business strength, the company will also raise additional funds to benchmark against international standards, accelerating its progress towards becoming a globally competitive and market-leading investment bank. As of the end of the third quarter of 2024, the merged assets of Guotai Junan and Haitong total 341.5 billion yuan, and net capital is 177.4 billion yuan, both ranking first in the Chinese securities industry. Furthermore, the net assets per share have increased from 17.02 yuan to 18.38 yuan, and the asset-liability ratio has decreased from 75.02% to 72.74%. The stronger capital strength and balanced asset-liability structure will significantly enhance the company's risk tolerance, improve capital utilization efficiency, and provide a solid financial foundation for future business expansion and market response. In addition, based on data from 2023, the merged companies rank first in important business indicators such as retail client numbers, retail client APP monthly active users, IPO underwriting scale and numbers, public fund income, custodial outsourcing scale, and the number of branches in key regions such as the Yangtze River Delta, Beijing-Tianjin-Hebei, and the Pearl River Delta. In the first three quarters of 2024, the merged investment banking business of the two companies had a net income of 3.1 billion yuan, with a net interest income of 4 billion yuan, and a loan scale of 145.8 billion yuan, all of which rank first in the Chinese securities industry. On the other hand, in addition to the share swap merger, Guotai Junan will also raise funds of up to 10 billion yuan for international business, trading investment, digital transformation, and operational capital after the merger, aiming to accelerate the development of a first-class investment bank and enhance the level of service to the real economy. Industry insiders believe that the merger of Guotai Junan Securities and Haitong, both large comprehensive securities firms, aligns with the strategic development direction of both companies. It will not only allow both sides to share professional capabilities and client resources, enhance customer service capabilities, improve management efficiency, and promote complementary advantages, but also strengthen risk resistance, enhance core competitiveness, better fulfill responsibilities, and enhance the level of service to the real economy. Seizing the historic development opportunity to help build a strong financial country In October of last year, the Central Financial Work Conference emphasized the importance of the capital market from a top-level design perspective, stating the need to "accelerate the construction of a strong financial country," "cultivate leading investment banks and investment institutions," and "support large state-owned financial institutions to become more competitive and stronger," emphasizing the need to "firmly follow the path of development with Chinese characteristics in finance." As one of the key elements of a "strong financial country," a strong financial institution is not only the cornerstone and support of promoting high-quality economic and social development but also an important vehicle for maintaining financial stability and enhancing the country's overall strength. In April of this year, the State Council issued new guidelines, proposing to "support leading institutions in enhancing core competitiveness through mergers and restructurings and organizational innovation." The China Securities Regulatory Commission has also issued related policies, specifying the goal of having "2 to 3 internationally competitive and market-leading investment banks and investment institutions" by 2035. Against this backdrop, the collaboration between Guotai Junan and Haitong perfectly aligns with the historical development opportunity in the industry. According to Guotai Junan and Haitong, the post-merger company will establish a new legal governance structure, management framework, development strategy, and corporate culture. Based on corporate governance requirements and overall business objectives and strategic planning, the integration of operations, assets, finances, personnel, and institutions will be comprehensively promoted to facilitate effective business integration and enhance overall profitability. In terms of business synergy, both sides will fully integrate and promote synergistic effects. For example, in capital utilization, leveraging existing platforms and financial advantages to optimize asset allocation, improve capital utilization efficiency, increase business scale and performance; In terms of service capabilities, integrating business resources, optimizing business structures, leveraging economies of scale, achieving co-development and complementary advantages, enhancing service capabilities, improving operational efficiency, and building a comprehensive leading core competitive strength; in terms of operations and management, leveraging talent advantages, management experience, improving governance levels, management efficiency, reducing operating costs, fully releasing synergies, and accelerating towards becoming a first-class investment bank with international competitiveness and market leadership. Currently, China's capital market has the largest and most active group of investors globally. The combination of the two companies is expected to ...Drive the reshaping of the industry competition landscape, forming a diverse financial product and service system to meet the needs of investors.Hola, cmo ests?