CSRC: Approve Guotai Junan's application to absorb and merge Haitong

On January 17th, the China Securities Regulatory Commission approved Guotai Junan to absorb and merge Haitong by issuing an additional 5,985,871,332 shares. The Commission also approved Guotai Junan's application to issue shares to raise supplementary funds of up to 10 billion yuan. After the merger is completed, Haitong will be dissolved in accordance with the law, and the original branches of Haitong will be changed to branches of Guotai Junan. The original text is as follows: Approval for Guotai Junan Securities Co., Ltd. to absorb and merge Haitong Securities Co., Ltd., raise supplementary funds, approval for changes in major shareholders and controllers of Haifutong Fund Management Co., Ltd., Fuguo Fund Management Co., Ltd., and Haitong Futures Co., Ltd. Guotai Junan Securities Co., Ltd., Haitong Securities Co., Ltd., Haifutong Fund Management Co., Ltd., Fuguo Fund Management Co., Ltd., and Haitong Futures Co., Ltd.: The China Securities Regulatory Commission has received the Shanghai Stock Exchange's submission regarding the stock swap absorption and merger of Guotai Junan Securities Co., Ltd. (hereinafter referred to as Guotai Junan) and Haitong Securities Co., Ltd. (hereinafter referred to as Haitong) as well as the fundraising opinions, and the relevant documents you have submitted. In accordance with the relevant provisions of the Securities Law of the People's Republic of China, the Company Law of the People's Republic of China, the Securities Investment Fund Law of the People's Republic of China, the Futures and Derivatives Law of the People's Republic of China, the Regulations on the Supervision and Management of Securities Companies, the Regulations on the Supervision and Management of Futures Trading, the General Office of the State Council's Notice on Implementing the Amendment of the Securities Law (State Council Office's Document No. 5 of 2020), the Measures for the Management of Major Asset Restructuring of Listed Companies (CSRC Order No. 214), the Regulations on the Management of Equity of Securities Companies (CSRC Order No. 183), the Measures for the Supervision and Administration of Publicly Offered Securities Investment Fund Managers (CSRC Order No. 198), the Measures for the Supervision and Administration of Futures Companies (CSRC Order No. 155), etc., the following approvals are now provided: 1. Approval for Guotai Junan to absorb and merge Haitong by issuing an additional 5,985,871,332 shares. 2. Approval for Guotai Junan's application to issue shares to raise supplementary funds of up to 10 billion yuan. 3. Approval for Guotai Junan to absorb and merge Haitong. After the merger is completed, Haitong will be dissolved in accordance with the law, and the original branches of Haitong will be changed to branches of Guotai Junan. 4. Approval for Guotai Junan to become the major shareholder of Haifutong Fund Management Co., Ltd. (hereinafter referred to as Haifutong Fund); approval for Shanghai International Group Co., Ltd. (hereinafter referred to as Shanghai International Group) to become the actual controller of Haifutong Fund; no objections to Guotai Junan's acceptance of 153 million yuan (51% of the registered capital) contribution from Haifutong Fund in accordance with the law. 5. Approval for Guotai Junan to become the major shareholder of Fuguo Fund Management Co., Ltd. (hereinafter referred to as Fuguo Fund); no objections to Guotai Junan's acceptance of a contribution of 144.43 million yuan (27.775% of the registered capital) from Fuguo Fund in accordance with the law. 6. Approval for Guotai Junan to become the major shareholder of Haitong Futures Co., Ltd. (hereinafter referred to as Haitong Futures); approval for Shanghai International Group to become the actual controller of Haitong Futures; no objections to Guotai Junan's acceptance of 1,083,101,687 shares of Haitong Futures (83.22% of the registered capital) in accordance with the law. 7. In this issuance of shares by Guotai Junan to absorb and merge Haitong and raise supplementary funds, you must strictly follow the relevant application documents submitted to the Shanghai Stock Exchange, complete the relevant procedures for issuing shares in accordance with the regulations, and promptly fulfill your information disclosure obligations. 8. Guotai Junan and Haitong should orderly proceed with the merger, implement related business, customer, and employee integration arrangements, ensure the legitimate rights and interests of customers are not harmed, properly place employees, and maintain social stability. 9. Guotai Junan should, in accordance with the preliminary integration plan submitted to us, within 1 year, formulate and submit a specific integration plan, clarify the timetable, and properly and orderly promote the integration work. Before the integration work is completed, Guotai Junan should effectively isolate risks with Haitong and its subsidiaries, strictly regulate related party transactions, and guard against conflicts of interest and transmission risks. 10. Guotai Junan should amend its articles of association in accordance with this approval and file the amended articles of association with the local securities regulatory bureau. 11. Haitong Futures should urge Guotai Junan and Shanghai International Group to complete the integration of Haitong Futures and Guotai Junan Futures Co., Ltd. in an orderly manner within the committed time frame as outlined in the plan submitted to us. 12. This approval for the issuance of shares by Guotai Junan to absorb and merge Haitong and raise supplementary funds is valid for 12 months from the date of issue. Haitong should complete the industrial and commercial deregistration process within 12 months from the date of this approval, and the original branches of Haitong and Guotai Junan should complete the industrial and commercial registration changes within 12 months from the date of this approval. 13. After the dissolution of Haitong, it should submit the Operations License for Securities and Futures Business to us. Guotai Junan and the original branches of Haitong should apply for the issuance of the Operations License for Securities and Futures Business within 15 days of receiving the business license. Please note that this is an edited and shortened translation of the original document. into EnglishFourteen, after this transaction is completed, Guotai Junan should urge its relevant overseas subsidiaries to comply with the laws and regulations and regulatory requirements of the countries and regions where they are located, operate in a compliant and prudent manner, and accept supervision by local regulatory authorities. Fifteen, in the implementation process, if any significant matters that need to be disclosed according to laws and regulations or if significant problems arise, you should promptly report to the CSRC, relevant securities regulatory bureaus, and the Shanghai Stock Exchange and handle them in accordance with relevant regulations. China Securities Regulatory Commission January 17, 2025 This article is excerpted from the China Securities Regulatory Commission, edited by GMTEight: Chen Wenfang.