Stocks with different rights in the same stock are expected to be included in the Hong Kong Stock Connect
The Shanghai and Shenzhen Stock Exchanges said that in order to further improve the interconnection mechanism, the Shanghai and Shenzhen Stock Exchanges agreed on the conditions for the different voting rights structure (WVR) companies listed in Hong Kong to be included in the Hong Kong Stock Connect.
The Shanghai and Shenzhen Stock Exchanges have revised the relevant business rules and publicly solicited opinions from the market today. In the next step, the Shanghai and Shenzhen Stock Exchanges will further revise and improve relevant business rules based on the opinions of all parties in the market, and officially release them to the market after fulfilling relevant decision-making and approval procedures.
Some relevant people told reporters that the revision of this rule can be described as a key step in the integration of different voting rights companies into the scope of Hong Kong stocks. After the revision is completed, there will be no more obstacles in this aspect, and then it will be able to step into the implementation stage.
The Shanghai and Shenzhen Stock Exchanges stated that on April 10, 2014, the China Securities Regulatory Commission and the Hong Kong Securities and Futures Commission issued a joint announcement stipulating that the Hong Kong Stock Connect's stock range includes, in principle, the Hang Seng Composite Large-Cap Index and the Hang Seng Composite Mid-Cap Index. Shares and H shares of A+H shares listed on the Hong Kong Stock Exchange and the Shanghai Stock Exchange, among which there may be different voting rights structure company shares. Considering the special nature of internal governance and shareholder rights of different voting rights structure companies, they are also new varieties in Hong Kong stocks. Therefore, through the joint research and evaluation of Shanghai and Shenzhen Stock Exchanges, the specific stock rights of different voting rights are included in the Hong Kong Stock Connect. Claim.
This time, the specific amendments of the Shanghai Stock Exchange are to include in the "Shanghai Stock Exchange Shanghai-Hong Kong Stock Exchange Implementation Measures" the first conditions for the inclusion of stocks of different voting rights. Specifically, it includes: first, listing for 6 months plus 20 Hong Kong stock trading days; second, 183 days before the date of investigation (including the day of the inspection day), the average daily market value is not less than HK$20 billion, and the total turnover of Hong Kong stocks is not less than HK$60. 100 million yuan; the third is compliance conditions.
The Shenzhen Stock Exchange added Article 56, paragraph 2, to the “Implementation Measures” to clarify the shares of companies with different voting rights listed on the Stock Exchange (except for the H shares of A+H listed companies). In addition to the conditions for the inclusion of existing Hong Kong stocks, the following conditions should be met at the same time:
First, the duration of the stable trading period is met, that is, the time for listing of companies with different voting rights structures in Hong Kong needs to meet the conditions of “6 months + 20 Hong Kong stock trading days”;
The second is to achieve a certain market value requirement, that is, the average daily market value of the Hong Kong stock trading day in the last 183 days is not less than HK$20 billion;
Third, it is in line with liquidity arrangements, that is, the total turnover of Hong Kong stocks on the 183th is not less than HK$6 billion;
Fourth, to meet the compliance requirements, that is, after the stock is listed, the stock issuer and the beneficiaries of different voting rights have not been publicly accused and other publicly disclosed by the Stock Exchange for violating corporate governance, information disclosure and investor protection measures. Sanctions or situations that trigger the termination of different voting rights.
Xiaomi and the US Mission are expected to be included in the Hong Kong Stock Connect
On April 30, 2018, based on the original listing system of the Hong Kong Stock Exchange, the restrictions on the emerging three types of companies were: the same-shared different-structured companies, non-revenue biotech companies, and the Hong Kong Stock Exchange as the second The company that is listed.
Subsequently, Xiaomi Group, the first company with the same rights and shares, was listed on the Hong Kong stock market in July last year. Since then, the topic of including the different voting rights structure (WVR) companies in the Hong Kong stock market has been repeatedly mentioned.
Among the companies that have already completed listing on the Hong Kong Stock Exchange, companies with different voting rights structures only have Xiaomi Group and US Group reviews.
According to the conditions published by the Shanghai and Shenzhen Stock Exchanges, Xiaomi Group and the US Mission Review are expected to be included in the Hong Kong Stock Connect. From the time of listing, Xiaomi Group's listing date is July 9th, 2018, and the US group's review is September 20th, 2018, which has exceeded the requirement of listing 6 months and 20 Hong Kong stock trading days. In terms of market value, the total market value of the US group reviews has reached 370 billion Hong Kong dollars, and the total market value of Xiaomi Group is 210.8 billion Hong Kong dollars. In addition, the average daily volume of the two companies is also in the billion and billion.
What is the meaning of different rights in the same stock?
The different rights of the same shares refer to the separation of voting rights and income rights. That is, the voting rights of the company are not completely distributed according to the principle of “one share and one right”. Minority shareholders can only hold fewer shares but can obtain voting rights greater than their shares.
Most of the different rights to implement the same shares are science and technology enterprises. According to Xingye's research and analysis, the business model of science and technology enterprises determines the inevitability of the different rights structure of the same stock.HuaweiAli,JingdongGoogle, Facebook, etc. are all different structures of the same stock, but differ in form. The science and technology enterprises are mainly based on light assets management, and it is difficult to obtain credit support from commercial banks. Such enterprises need a large amount of capital investment at the beginning, and the profit cycle is longer than that of traditional enterprises, and the urgency of financing is higher. Multiple rounds of equity financing can easily dilute the company's founders or management team shares, and even lose the company's operational decision-making power. A typical example is the same-share systemappleIn 1985, when Jobs was driven out of Apple's board of directors, he only held 11.3% of the shares.
At the beginning of the 20th century, the New York Stock Exchange first introduced a dual-equity system, which was suspended for decades due to various pressures. But the other two exchanges, the American Stock Exchange and Nasdaq, have begun to be tolerant of dual equity, attracting more companies to list, and many companies already listed on the NYSE also plan to issue shares with different rights. The NYSE also chose to liberalize the dual equity constraint. In the game of several major exchanges, the listing and management system of companies with different rights and interests have gradually improved.
Since 1989, the Hong Kong Stock Exchange has cancelled the listing of Class B shares. In 2013, Alibaba abandoned its listing in Hong Kong stocks and went public in the US stock market. After the Hong Kong Stock Exchange “missed” Alibaba, it reopened to avoid continuing to miss the leading technology companies. The system of different rights in the same stock.