Shanghai, China – The Shanghai municipal government has given its approval for the merger of GuoTai Junan Securities and Haitong Securities, creating the largest securities firm in China by asset size.
According to Jiemian News, the Shanghai Municipal People's Government issued a document approving the merger of GuoTai Junan Securities and Haitong Securities. The Shanghai State-owned Assets Supervision and Administration Commission (SASAC) will strengthen its organization, clarify its roles, and guide the smooth progress of equity transactions, corporate name changes, management restructuring, and business integration.
The swift approval of the merger has drawn media attention. The merger plan was announced on October 9th through a public disclosure, and the approval document, dated October 15th, was released just six days later.
According to the preliminary agreement, the exchange ratio for GuoTai A shares is 13.83 yuan/share, and the exchange ratio for Haitong A shares is 8.57 yuan/share. The exchange ratio is 1:0.62, meaning that one Haitong A share can be exchanged for 0.62 GuoTai A shares, and one Haitong H share can be exchanged for 0.62 GuoTai H shares. The exchange price for GuoTai H shares is HK$7.73/share, and the exchange price for Haitong H shares is HK$4.79/share.
Haitong was established by the Bank of Communications in 1988. Headquartered in Shanghai, it was listed on the A-share market in 2007 and the Hong Kong H-share market in 2012. It is one of the oldest and most comprehensive large securities firms in China, with an integrated business platform, marketing network, and a solid customer base.
GuoTai Junan was established in 1999 through the merger of GuoTai Securities and Junan Securities. Also headquartered in Shanghai, it was listed on the A-share market in 2015 and the Hong Kong H-share market in 2017. In recent years, it has consistently ranked among the top in the industry in terms of key financial indicators and has received the highest A-AA rating from the China Securities Regulatory Commission for 17 consecutive years.
The merger of the two securities firms is the largest A+H market acquisition in the history of the Chinese capital market and the largest merger of listed securities companies in the A+H market. According to the third quarter report of 2024, GuoTai Junan's net assets are 1.625185 trillion yuan (approximately 316.2122 billion US dollars), and Haitong's net assets are 300.82 billion yuan (approximately 58.5305 billion US dollars), surpassing Citic Securities to become the industry leader.
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