Guotai Junan to merge with Haitong Securities in stock swap

Guotai Junan Securities Co., Ltd. will absorb and merge with Haitong Securities Co., Ltd. in a stock swap, creating a combined entity with significantly increased assets and market share. Guotai Junan will issue A-shares and H-shares to Haitong's shareholders at a ratio of 1:0.62. This implies a share exchange price of RMB 13.83 per share for Guotai Junan and RMB 8.57 per share for Haitong. Concurrently, Guotai Junan plans to raise up to RMB 10 billion through a private placement of A-shares with Shanghai State-owned Assets Operation Co., Ltd., primarily to bolster its international business, trading and investment operations, digital transformation initiatives, and working capital. The merger is expected to create a leading investment bank with enhanced capital strength, customer base, and operational efficiency. Post-merger, the combined company’s total assets are projected to increase by 74.09% to RMB 16,223.83 billion.