Market Insight | Major Asset Restructuring Plan Implemented Haitong Securities opens 134% higher Guotai Junan Securities opens 106% higher

According to the information from Zhitong Finance and Economics APP, the merger and reorganization of Guotai Junan Securities and Haitong Securities is progressing smoothly, and both sides opened collectively higher this morning. As of the time of publication, Haitong Securities (06837) rose by 134.35% to HKD 8.5, while Guotai Junan (02611) rose by 106.17% to HKD 16.3.

On the news front, on the evening of October 9th, Guotai Junan and Haitong Securities simultaneously released the merger and reorganization related proposals and joint announcements on the Shanghai Stock Exchange and the Hong Kong Stock Exchange, and are planning to resume trading on October 10th. The two parties plan to conduct a major asset restructuring through a stock-for-stock absorption merger and raise supporting funds. The stock exchange ratio between Haitong Securities and Guotai Junan is 1:0.62, meaning that every 1 share of Haitong Securities A shares can be exchanged for 0.62 shares of Guotai Junan A shares, and every 1 share of Haitong Securities H shares can be exchanged for 0.62 shares of Guotai Junan H shares. The merged company will adopt a new company name.

Guangda Securities analysis stated that the proposed merger of Guotai Junan absorbing Haitong Securities is also a merger of local state-owned securities firms. After the merger of the two companies, the new company is expected to achieve a strong alliance, and the comprehensive strength of the new company is expected to rise to the leading position in the securities industry, creating a "carrier-level" securities firm in the industry. Against the background of regulatory policies guiding the "cultivation of first-class investment banks and investment institutions" and increasing profit differentiation in the industry, the securities industry's mergers and acquisitions are expected to enter an accelerated phase