The Shenzhen Stock Exchange (SZSE) has recently amended the Business Rules for Major Assets Restructuring (the “Business Rules”) to facilitate relevant business by listed companies.
The following amendments are made:
1) restructuring events are divided into two types subject to whether administrative permissions are required, and different disclosure procedures will be adopted;
2) disclosure requirements in respect of commitments made by related parties in the restructuring, assessments or valuations and earnings forecasts, filling measures for dilution of earnings per share, etc. are further specified; and
3) supervisory transparency is further enhanced by requesting listed companies to disclose the contents of SZSE enquires about non-administrative permission types of restructuring and the situations of amendments to restructuring plans.
To further enhance the approval transparency of M&A and restructuring events and realize full openness on approval processes, the China Securities Regulatory Commission (CSRC) has recently began to make public the feedbacks put forth during the approval processes and corresponding replies from applicants. In a bid to implement the CSRC arrangements, relevant disclosure requirements are detailed in the amendments to the Business Rules:
1) listed companies shall disclose the situations and contents of feedbacks from CSRC during the approval process no later than the next trading day upon receiving them;
2) within 30 days upon receiving the feedbacks, listed companies shall actively prepare for reply materials and disclose their contents after completing the required decision-making procedures; related securities intermediaries shall at the same time conduct due diligence to issues involved in the feedbacks or issue supplementary opinions; and
3) listed companies shall submit reply materials to the CSRC immediately after disclosing their contents; in the event of failure to submit reply material to the CSRC within 30 days upon receiving the feedbacks, listed companies shall disclose progressing situations of the major assets restructuring and reasons of the failure to provide timely replies on the next trading day of the deadline.