Ningbo Shanshan, a lithium battery company, and Keda Industrial, a building materials machinery company, announced that they will be part of the first batch of RMB ordinary-share (A-share) companies to be listed on the Swiss Stock Exchange.
Meanwhile, Gotion Hi-Tech, another lithium battery company, also announced on the evening of July 22 that its issuing of GDRs in Switzerland had been approved by the China Securities Regulatory Commission and the conditions of the Swiss Stock Exchange, bringing it just one step away from the formal approval of listing.
These companies echo the intensive expression of support from Chinese regulators for overseas listing of domestic companies. In February this year, the country issued the “Regulation on Interconnection of Depositary Receipts Business Between Chinese and Overseas Stock Exchanges,” which expanded the scope of application. In China, qualified listed companies of the Shenzhen Stock Exchange (SZSE) were included, while overseas, the stock exchange scope was expanded to major European markets such as Switzerland and Germany.
The moves are considered to be an important step in China’s capital market reform, conducive to improving the openness of the domestic capital market, and to the establishment of the image of domestic enterprises in the international capital market.
Ningbo Shanshan announced on July 22 that the prospectus issued by the company to list on the Swiss Stock Exchange was approved by the Prospectus Office of the Supervisory Bureau of Swiss Stock Exchange. Each GDR to be issued this time represents five A shares of the company, and the total amount of funds to be raised is between $200 million and $400 million.
Keda Industrial announced on July 20 that the company had been approved by the Swiss Stock Exchange Supervision Bureau on the prospectus of the company issuing GDR and listing on the Swiss Stock Exchange. According to the announcement, the price range of GDR issued by Kodak Manufacturing is expected to be $14.43 to $14.58 per GDR, and it is planned to raise $173 million to $292 million.
The two companies claimed that the issued GDRs shall not be converted into A shares within 120 days from the date of listing, or within the stable price period. After the restriction period, accredited investors can trade GDRs through the international order market, and conduct cross-border conversion between GDR and A shares through cross-border conversion institutions. Cross-border conversion includes converting A shares into GDRs and converting GDRs into A shares.