Guotai Junan and Haitong merger gets regulatory approval

Guotai Junan Securities Co., Ltd. (SSE:601211) received regulatory approval for its merger with Haitong Securities Co., Ltd. The China Securities Regulatory Commission (CSRC) accepted the application, while the State Administration for Market Regulation gave antitrust clearance. The merger will create a securities firm with combined assets of ¥16.22 trillion ($2.23T USD) and net assets attributable to the parent company of ¥3.27 trillion ($450B USD), ranking first and second in the industry respectively. The combined firm's projected revenue and net profit would be ¥688 billion ($94B USD) and ¥188 billion ($26B USD). The transaction involves a share swap with both A-shares and H-shares utilizing the same exchange ratio based on a 60-day average trading price. Guotai Junan plans to raise up to ¥100 billion ($14B USD) in supporting funds to bolster its international operations, trading and investment business, and digital transformation. Shanghai State-owned Assets Operation Co., Ltd. has committed to subscribe to the entire supporting funds offering.