Rui Xing is dying, and the 100 billion myth is shattered.
Editor’s note: This article comes from the WeChat public account ” Tech planet “(ID: tech618) , author: Zhou Xiaoqi, editor: Zhang Yuting.
The myth of Ruixing is speeding up.
On May 19, Ruixing Coffee issued an announcement saying that it received a written notice from the NASDAQ listing eligibility review department on May 15 and the exchange made a decision to delist Ruixing Coffee.
Rui Xing plans to hold a hearing on this issue. Before the hearing results are released, Rui Xing will continue to be listed on the Nasdaq. The hearing will usually be held 30 to 45 days after the date of the hearing request.
In response to the delisting notice, Lu Zhengyao, chairman of Ruixing in the early morning of May 20, issued a statement, “The Nasdaq asked the company to withdraw from the market without waiting for the final investigation result, which is unexpected. I personally feel deeply disappointed and regret. “
Lu Zhengyao said in the statement: I have been on the front line of the industry. The style may be too aggressive. The enterprise runs too fast, which also causes many problems. However, I never deceive investors with “concepts”. I really want to Make the company bigger and create value for the society! Whenever I see people holding a small blue cup in my hand, I will be proud. “I firmly believe that Ruixing Coffee’s business model and business logic are established, and Ruixing Coffee’s annual revenue has continued to grow since its operation.”
Lu Zhengyao said that almost all the money earned since the start of the venture was invested in physical enterprises, and the funds pledged by Ruixing Coffee stocks were also used to support the business development of each of its subsidiaries, not used for personal profligacy, nor transferred assets. , Willing to accept any investigation.
“I have been in deep pain and self-blame for more than a month, and I ca n’t sleep at night. If the company leaves the market, the difficulties and pressures it faces will continue to increase, but no matter what, I will Do our best to maintain store operations, do everything we can to recover shareholder losses, and let Ruixing this brand go on. “, Lu Zhengyao said.
One year ago, on May 17, Ruixing founded 18 months before logging in to NASDAQ, setting a record for the fastest listing of Chinese companies in the United States and the highest market value Time soared to nearly 13 billion US dollars. However, what is astonishing is that on April 2, Ruixing revealed that the financial data of 2.2 billion yuan was suspected of being falsified, which caused an “earthquake” and the aftershocks continue to this day.
Delisting does not affect class actions
April 13 is the deadline for Ruixing Coffee ’s class action application for the chief plaintiff. Earlier, many domestic and foreign law firms stated that investors who purchased marketing coffee stocks from November 13, 2019 to April 1, 2020 can contact them to obtain free case evaluations.
“Whether Ruixing Coffee is delisted or delisted will not hinder the progress of the class action, but the delisting of listed companies will definitely affect the company’s solvency,” Hao Junbo, the chief lawyer of Beijing Hao Junbo Law Firm told Tech Planet.
Hao Junbo also said that the source of compensation for class action litigation will be wider. Generally, listed companies can purchase actual liability by the insurance company through the purchase of directors ’liability insurance, but Ruixing Coffee ’s case is somewhat complicated and needs to be considered. To the insurance company may refuse to pay.
Furthermore, it is not excluded that the responsible parties of Ruixing Coffee, such as intermediaries such as accounting firms, will also be required to bear compensation liabilities to investors. In the previous Enron fraud case, Andaxing Certified Public Accountants was sentenced to bankruptcy after being convicted of obstructing justice.
“After the deadline for the chief plaintiff ’s application, the court will select the chief plaintiff and the chief lawyer from among them, and the specific time depends on the degree of competition in the case. If multiple law firms want to becomeChief lawyer, in very rare cases, it takes one or two years for the law firm to compete for the qualification of chief plaintiff, “said Hao Junbo.
According to Tech Planet (ID: tech618), when many plaintiffs have the same litigation request, the Class Action Law of the United States will select one or more victims as representatives to participate in the whole process of the litigation, which is called the chief plaintiff. At this time, the court only needs to hear one case, and the result of the trial is applicable to all investors.
After the court determines the chief plaintiff, formal litigation can proceed. It is worth noting that in securities litigation cases, there is also a key procedure. As a defendant, a listed company can apply to the court to dismiss the plaintiff ’s application. If the court approves the application, the case is directly rejected and the investor loses. If there is no rejection, the lawsuit will continue.
Hao Junbo said that although in theory, Ruixing Coffee’s financial fraud caused investors to be damaged, Ruixing should compensate investors for losses, but in the actual process, Ruixing negotiated with investors and even bargained. The extent of the defendant ’s fault, actual ability to compensate, and whether the plaintiff accepts the flexibility of the amount of compensation will be considered.
Classic litigation cases usually last 2 to 3 years, and the formal judgment depends on various aspects of the case.
Hao Junbo said that the current class action lawsuit against Ruixing Coffee is still proceeding step by step, and the chief plaintiff and chief lawyer have not yet determined. According to the characteristics of the US securities class action system, the chief plaintiff and chief lawyer must be selected before the class action can enter the next stage.
Since the establishment of Ruixing Coffee, it has only been 18 years since it went on the market. It has only been 18 months. Ruixing, who likes blitzkrieg, even “self-exposed” financial fraud, but also a sudden attack. Without any warning, Ruixing Coffee, which was listed for only 11 months, had “self-exposure” on April 2 that the total amount of counterfeit sales of the company was as high as 2.2 billion yuan.
The investors of Ruixing feel a little untrue. “I knew the news that night and immediately went to read the original report to confirm the authenticity.” Yang Bo, an investor who bought Ruixing stock. Yang Bo sold Ruixing’s stock for the first time, but the rapid decline in stock price caused him to lose 80,000 yuan in an instant.
The market responded quickly. On April 2, Ruixing was ahead It fell by more than 85% and triggered a fuse. After the opening of the market, six intra-day fuse caused the suspension of trading and the market value evaporated 5 billion U.S. dollars. On April 3, the same major shareholder Lu Zhengyao’s Hong Kong stock China car rental plunged 54.42% after the opening, and then suspended trading. Compared with yesterday, it has shrunk by nearly 6 billion Hong Kong dollars, falling below 2.8 billion Hong Kong dollars.
Related investors are being pulled into a deeper vortex.
What is the chance of turning over?
“After Ruixing blew its financial fraud, the stock price plunged that day, and the losses of its investors were particularly huge. We collected many lawsuits from investors who lost more than one million dollars.” Hao Junbo said.
As the first domestic law firm to represent an international securities class action lawsuit, Hao Junbo launched an announcement for the chief plaintiff to the world after the Ruixing report was released in Hunshui.
Hao Junbo said: “This type of litigation is a civil claim litigation on behalf of investors, so it does not involve the issue of penalties for listed companies. The administrative enforcement power is the obligation and power of the US Securities Regulatory Commission.”
Now, Luckin Coffee officially received a written notice from Nasdaq and decided to delist it. After receiving the notice, Ruixing Coffee plans to hold a hearing.
Hao Junbo said that at the hearing, Ruixing Coffee had the right to present a defense. In theory, there is a possibility of delisting, but “this possibility is minimal.”
Before In the US stock market, there have also been financial frauds of listed companies. 200In 1 year, the American energy company Enran broke the issue of financial fraud and was investigated, which directly led to Enron ’s bankruptcy and bankruptcy. Enron ’s investors received US $ 7.14 billion in compensation through class action.
At the same time, many of Enron ’s executives were charged with criminal charges. The company ’s CEO Jeffrey Skilling was sentenced to 24 years and fined $ 45 million, and financial planner Festo was sentenced to six years ’imprisonment and fined $ 23.8 million .
Who will be the ultimate responsible person?
“Most securities litigation refers to the defendant as the first entity of the listed company, and may also include major executives, such as the CEO, CEO Chief Financial Officer CFO, because these two positions are more important, the possibility of participating in illegal activities is greater, “Hao Junbo said.
Lawyer Wei Peng told Tech Planet (ID: tech618) that US law does not stipulate that the person responsible for financial fraud of listed companies is a large shareholder or executive. The ultimate responsible person is determined based on whether the shareholder litigation or the SEC has evidence.
“As long as the prosecution has evidence to prove that the person responsible, whether it is a large shareholder or the lowest clerk. As long as there is evidence that this person has played a role in this matter, leading to the occurrence of the incident, you need to bear responsibility. This Things are currently difficult to generalize, depending on how the final evidence is shown, “Wei Peng said.
Recently, Ruixing Coffee has changed frequently. On May 12, Rui Xing Coffee CEO Qian Zhiya and COO Liu Jian were suspended, and the two proposed to withdraw from the board of directors. In addition, the company also suspended six other employees who participated in or learned about the false transaction.
At the same time, in the announcement released on May 12, Lu Zhengyao, chairman of Ruixing Coffee, was no longer in the “Nomination and Corporate Governance Committee”, which means that Lu Zhengyao has withdrawn from the committee.
At this point, Lu Zhengyao and Qian Zhiya, two key figures of Ruixing Coffee, no longer hold any positions in Ruixing. In addition, Thomas P. Meier, Independent Director of Ruixing Coffee, and He Gang, CTO, have also left.
“Class action suits both companies and individuals, although Lu Zhengyao,Qian Zhiya withdrew from the company, but as executives of the company, they still have to bear relevant legal responsibilities, “Hao Junbo said.
However, Hao Junbo also said that because Chinese executives are Chinese citizens, there will be practical difficulties in the enforcement stage of the lawsuit, which may lead to the final failure of the US courts to hold Chinese citizens accountable.
Which related institutions will be implicated?
In addition to the company involved, the Ruixing incident will also be affected.
Hao Junbo specifically mentioned that if an auditor firm, an accounting firm, a law firm, or even an underwriter or securities firm are at fault, they may also become defendants.
In the Enron incident, the Andersen accounting firm, which provided auditing of financial statements at that time, was implicated in fines of $ 500,000 and was prohibited from engaging in business for 5 years. Anderson also became the first large accounting firm to be found “guilty” in American history, and has since withdrawn from the audit industry for 89 years.
According to media reports, after Hunshui released Ruixing’s short report on January 31, Ernst & Young Huaming Certified Public Accountants (hereinafter referred to as Ernst & Young) appointed a dozen anti-fraud teams to intervene and found fraudulent facts According to regulations, Ruixing Coffee initiated an internal investigation and urged the company to announce the investigation results as soon as possible.
According to this statement, Ernst & Young promoted Ruixing Coffee to independently disclose fraud and fraud. Tech Planet confirmed with Ernst & Young for the first time, and had not received a reply until the time of publication.
Hao Junbo said that in general, in securities litigation cases, it is unlikely that an intermediary agency will become a defendant. Although intermediaries, such as law firms, accounting firms, and other agencies have issued some documents, these documents are based on the listed companies being responsible for the authenticity of the documents. As long as the intermediaries meet their investigation obligations, they do not need to bear additional compensation. damage.
No matter what the final Ruixing outcome is, this class action has already had a huge indirect impact on it.
“No institution in the United States can ask the company to forcefully dissolve through the court, onlyThe company makes business compensation. Once the US Securities and Exchange Commission (SEC) conducts an investigation, even Ruixing’s delisting will not affect the SEC’s continued investigation and punishment, “Wei Peng said.
The aftermath of the Chinese stock market is over
The influence of Ruixing Coffee on China General Stock is continuous.
Except for iQiyi and who they learn from, companies have been short-successfully. Good future directly exposed, announced on April 8 that it found that employees collaborated with external suppliers to forge contracts, exaggerating the sales revenue of related businesses. After the announcement, Good Future’s stock price plummeted, evaporating $ 2.2 billion that day.
On May 19th, Ruisi Education even directly announced that it had turned from profit to loss, directly announcing that the epidemic had a significant adverse impact on the operation of the first quarter.
However, it seems that the worst transcripts are thousands of times better than “lie”.
“The Ruixing incident may allow third-party observation agencies that are specifically short-selling and staring at China Prospective Stocks to target China Prospective Stocks more closely and systematically investigate China Prospective Stock Companies. Then there is a situation that exposes the problems of the stock companies in the stock, which may be repeated, “Wei Peng said.
Mr. Zhang Xu, chairman of the China Business Department of Carter Ledyard & Milburn LLP, has practiced in the United States for more than ten years. Listing tide.
She introduced to Tech Planet (ID: tech618): “In 2007 and 2008, a large wave of Chinese companies came to the United States for listing, and many companies in that wave of trends were investigated by the US SEC and prosecuted by shareholders. Delisting. “
Analysis Zhang said, “After 2011, the Chinese stock market in the US stock market remained quiet for a few years, but around 2018, the Chinese stock market listing wave came again. This wave of companies is different from the first wave. The difference is that there are not many Chinese and Chinese companies listed on the stock market a decade ago. The Internet and new technology companies are not as many as they are now, and their valuation and scale are not as large as they are now. Moreover, buying shells and reverse listings were popular at the time. These transaction structures led to serious financial fraud. ”
Wei Peng said that starting in 2019, including the SEC and two mainstream U.S. exchanges, has strengthened the supervision of the Chinese stock market. The SEC clearly stated that it does not welcome certain types of companies, such as P2P companies.
“Before the financial fraud incident, Chinese companies going to the US for listing have been questioned very frequently. It is expected that there will be more in recent years,” Wei Peng said. “After the Ruixing financial fraud incident, it may be Affects the views of US institutions and US investors on Chinese stocks. If market acceptance is affected, institutional investors will dare not invest in Chinese stocks in the future. “
Before the Ruixing incident, the attractiveness of Chinese stocks to international investors has declined. According to Bloomberg data, the share prices of Chinese companies listed in the US this year averaged 12% lower than the issue price, while other newly listed companies fell 7.5%, which means that the return on investment stocks is not satisfactory.
Following Chinese companies that want to land on the US capital market will also be wearing colored glasses for a long time, making it more difficult to go public.
Affected by the Ruixing incident, international investment institutions are also more cautious about underwriting the listing of Chinese companies. Currently, international investment banks have withdrawn from the plan to underwrite the listing of Chinese companies. Credit Suisse Bank, which previously assisted in the listing of Credit Suisse, had originally planned to underwrite the Internet medical platform WeChat in Hong Kong this year. However, due to the influence of Credit Suisse, Credit Suisse Bank was sued by shareholders and then withdrew from the underwriting of Weixing.
Wei Peng reminded that corporate management ’s decision-making mistakes can be accepted by the government and the market; but once a lie is lost, it is difficult to recover from the loss of trust. “Even if the financial report is particularly ugly and the stock falls, do n’t lie. SEC investigates well. ”
(At the request of the interviewee, Yang Bo and Wei Peng became pseudonyms.)
“After Ruixing blew its financial fraud, the stock price plunged that day, and the losses of its investors were particularly huge. We collected many lawsuits from investors who lost more than one million dollars.” Hao Junbo said.
As the first domestic law firm to represent an international securities class action lawsuit, Hao Junbo launched an announcement for the chief plaintiff to the world after the Ruixing report was released in Hunshui.
Hao Junbo said: “This type of litigation is a civil claim litigation on behalf of investors, so it does not involve the issue of penalties for listed companies. The administrative enforcement power is the obligation and power of the US Securities Regulatory Commission.”
Now, Luckin Coffee officially received a written notice from Nasdaq and decided to delist it. After receiving the notice, Ruixing Coffee plans to hold a hearing.
Hao Junbo said that at the hearing, Ruixing Coffee had the right to present a defense. In theory, there is a possibility of delisting, but “this possibility is minimal.”
At the same time, many of Enron ’s executives were charged with criminal charges. The company ’s CEO Jeffrey Skilling was sentenced to 24 years and fined $ 45 million, and financial planner Festo was sentenced to six years ’imprisonment and fined $ 23.8 million .
Who will be the ultimate responsible person?
“Most securities litigation refers to the defendant as the first entity of the listed company, and may also include major executives, such as the CEO, CEO Chief Financial Officer CFO, because these two positions are more important, the possibility of participating in illegal activities is greater, “Hao Junbo said.
Lawyer Wei Peng told Tech Planet (ID: tech618) that US law does not stipulate that the person responsible for financial fraud of listed companies is a large shareholder or executive. The ultimate responsible person is determined based on whether the shareholder litigation or the SEC has evidence.
“As long as the prosecution has evidence to prove that the person responsible, whether it is a large shareholder or the lowest clerk. As long as there is evidence that this person has played a role in this matter, leading to the occurrence of the incident, you need to bear responsibility. This Things are currently difficult to generalize, depending on how the final evidence is shown, “Wei Peng said.
Recently, Ruixing Coffee has changed frequently. On May 12, Rui Xing Coffee CEO Qian Zhiya and COO Liu Jian were suspended, and the two proposed to withdraw from the board of directors. In addition, the company also suspended six other employees who participated in or learned about the false transaction.
At the same time, in the announcement released on May 12, Lu Zhengyao, chairman of Ruixing Coffee, was no longer in the “Nomination and Corporate Governance Committee”, which means that Lu Zhengyao has withdrawn from the committee.
At this point, Lu Zhengyao and Qian Zhiya, two key figures of Ruixing Coffee, no longer hold any positions in Ruixing. In addition, Thomas P. Meier, Independent Director of Ruixing Coffee, and He Gang, CTO, have also left.
“Class action suits both companies and individuals, although Lu Zhengyao,Qian Zhiya withdrew from the company, but as executives of the company, they still have to bear relevant legal responsibilities, “Hao Junbo said.
However, Hao Junbo also said that because Chinese executives are Chinese citizens, there will be practical difficulties in the enforcement stage of the lawsuit, which may lead to the final failure of the US courts to hold Chinese citizens accountable.
Which related institutions will be implicated?
In addition to the company involved, the Ruixing incident will also be affected.
Hao Junbo specifically mentioned that if an auditor firm, an accounting firm, a law firm, or even an underwriter or securities firm are at fault, they may also become defendants.
In the Enron incident, the Andersen accounting firm, which provided auditing of financial statements at that time, was implicated in fines of $ 500,000 and was prohibited from engaging in business for 5 years. Anderson also became the first large accounting firm to be found “guilty” in American history, and has since withdrawn from the audit industry for 89 years.
According to media reports, after Hunshui released Ruixing’s short report on January 31, Ernst & Young Huaming Certified Public Accountants (hereinafter referred to as Ernst & Young) appointed a dozen anti-fraud teams to intervene and found fraudulent facts According to regulations, Ruixing Coffee initiated an internal investigation and urged the company to announce the investigation results as soon as possible.
According to this statement, Ernst & Young promoted Ruixing Coffee to independently disclose fraud and fraud. Tech Planet confirmed with Ernst & Young for the first time, and had not received a reply until the time of publication.
Hao Junbo said that in general, in securities litigation cases, it is unlikely that an intermediary agency will become a defendant. Although intermediaries, such as law firms, accounting firms, and other agencies have issued some documents, these documents are based on the listed companies being responsible for the authenticity of the documents. As long as the intermediaries meet their investigation obligations, they do not need to bear additional compensation. damage.
No matter what the final Ruixing outcome is, this class action has already had a huge indirect impact on it.
“No institution in the United States can ask the company to forcefully dissolve through the court, onlyThe company makes business compensation. Once the US Securities and Exchange Commission (SEC) conducts an investigation, even Ruixing’s delisting will not affect the SEC’s continued investigation and punishment, “Wei Peng said.
The aftermath of the Chinese stock market is over
The influence of Ruixing Coffee on China General Stock is continuous.
Except for iQiyi and who they learn from, companies have been short-successfully. Good future directly exposed, announced on April 8 that it found that employees collaborated with external suppliers to forge contracts, exaggerating the sales revenue of related businesses. After the announcement, Good Future’s stock price plummeted, evaporating $ 2.2 billion that day.
On May 19th, Ruisi Education even directly announced that it had turned from profit to loss, directly announcing that the epidemic had a significant adverse impact on the operation of the first quarter.
However, it seems that the worst transcripts are thousands of times better than “lie”.
“The Ruixing incident may allow third-party observation agencies that are specifically short-selling and staring at China Prospective Stocks to target China Prospective Stocks more closely and systematically investigate China Prospective Stock Companies. Then there is a situation that exposes the problems of the stock companies in the stock, which may be repeated, “Wei Peng said.
Mr. Zhang Xu, chairman of the China Business Department of Carter Ledyard & Milburn LLP, has practiced in the United States for more than ten years. Listing tide.
She introduced to Tech Planet (ID: tech618): “In 2007 and 2008, a large wave of Chinese companies came to the United States for listing, and many companies in that wave of trends were investigated by the US SEC and prosecuted by shareholders. Delisting. “
Analysis Zhang said, “After 2011, the Chinese stock market in the US stock market remained quiet for a few years, but around 2018, the Chinese stock market listing wave came again. This wave of companies is different from the first wave. The difference is that there are not many Chinese and Chinese companies listed on the stock market a decade ago. The Internet and new technology companies are not as many as they are now, and their valuation and scale are not as large as they are now. Moreover, buying shells and reverse listings were popular at the time. These transaction structures led to serious financial fraud. ”
Wei Peng said that starting in 2019, including the SEC and two mainstream U.S. exchanges, has strengthened the supervision of the Chinese stock market. The SEC clearly stated that it does not welcome certain types of companies, such as P2P companies.
“Before the financial fraud incident, Chinese companies going to the US for listing have been questioned very frequently. It is expected that there will be more in recent years,” Wei Peng said. “After the Ruixing financial fraud incident, it may be Affects the views of US institutions and US investors on Chinese stocks. If market acceptance is affected, institutional investors will dare not invest in Chinese stocks in the future. “
Before the Ruixing incident, the attractiveness of Chinese stocks to international investors has declined. According to Bloomberg data, the share prices of Chinese companies listed in the US this year averaged 12% lower than the issue price, while other newly listed companies fell 7.5%, which means that the return on investment stocks is not satisfactory.
Following Chinese companies that want to land on the US capital market will also be wearing colored glasses for a long time, making it more difficult to go public.
Affected by the Ruixing incident, international investment institutions are also more cautious about underwriting the listing of Chinese companies. Currently, international investment banks have withdrawn from the plan to underwrite the listing of Chinese companies. Credit Suisse Bank, which previously assisted in the listing of Credit Suisse, had originally planned to underwrite the Internet medical platform WeChat in Hong Kong this year. However, due to the influence of Credit Suisse, Credit Suisse Bank was sued by shareholders and then withdrew from the underwriting of Weixing.
Wei Peng reminded that corporate management ’s decision-making mistakes can be accepted by the government and the market; but once a lie is lost, it is difficult to recover from the loss of trust. “Even if the financial report is particularly ugly and the stock falls, do n’t lie. SEC investigates well. ”
(At the request of the interviewee, Yang Bo and Wei Peng became pseudonyms.)
The influence of Ruixing Coffee on China General Stock is continuous.
Except for iQiyi and who they learn from, companies have been short-successfully. Good future directly exposed, announced on April 8 that it found that employees collaborated with external suppliers to forge contracts, exaggerating the sales revenue of related businesses. After the announcement, Good Future’s stock price plummeted, evaporating $ 2.2 billion that day.
On May 19th, Ruisi Education even directly announced that it had turned from profit to loss, directly announcing that the epidemic had a significant adverse impact on the operation of the first quarter.
However, it seems that the worst transcripts are thousands of times better than “lie”.
“The Ruixing incident may allow third-party observation agencies that are specifically short-selling and staring at China Prospective Stocks to target China Prospective Stocks more closely and systematically investigate China Prospective Stock Companies. Then there is a situation that exposes the problems of the stock companies in the stock, which may be repeated, “Wei Peng said.
Mr. Zhang Xu, chairman of the China Business Department of Carter Ledyard & Milburn LLP, has practiced in the United States for more than ten years. Listing tide.
She introduced to Tech Planet (ID: tech618): “In 2007 and 2008, a large wave of Chinese companies came to the United States for listing, and many companies in that wave of trends were investigated by the US SEC and prosecuted by shareholders. Delisting. “
Analysis Zhang said, “After 2011, the Chinese stock market in the US stock market remained quiet for a few years, but around 2018, the Chinese stock market listing wave came again. This wave of companies is different from the first wave. The difference is that there are not many Chinese and Chinese companies listed on the stock market a decade ago. The Internet and new technology companies are not as many as they are now, and their valuation and scale are not as large as they are now. Moreover, buying shells and reverse listings were popular at the time. These transaction structures led to serious financial fraud. ”
Wei Peng said that starting in 2019, including the SEC and two mainstream U.S. exchanges, has strengthened the supervision of the Chinese stock market. The SEC clearly stated that it does not welcome certain types of companies, such as P2P companies.
“Before the financial fraud incident, Chinese companies going to the US for listing have been questioned very frequently. It is expected that there will be more in recent years,” Wei Peng said. “After the Ruixing financial fraud incident, it may be Affects the views of US institutions and US investors on Chinese stocks. If market acceptance is affected, institutional investors will dare not invest in Chinese stocks in the future. “
Before the Ruixing incident, the attractiveness of Chinese stocks to international investors has declined. According to Bloomberg data, the share prices of Chinese companies listed in the US this year averaged 12% lower than the issue price, while other newly listed companies fell 7.5%, which means that the return on investment stocks is not satisfactory.
Following Chinese companies that want to land on the US capital market will also be wearing colored glasses for a long time, making it more difficult to go public.
Affected by the Ruixing incident, international investment institutions are also more cautious about underwriting the listing of Chinese companies. Currently, international investment banks have withdrawn from the plan to underwrite the listing of Chinese companies. Credit Suisse Bank, which previously assisted in the listing of Credit Suisse, had originally planned to underwrite the Internet medical platform WeChat in Hong Kong this year. However, due to the influence of Credit Suisse, Credit Suisse Bank was sued by shareholders and then withdrew from the underwriting of Weixing.
Wei Peng reminded that corporate management ’s decision-making mistakes can be accepted by the government and the market; but once a lie is lost, it is difficult to recover from the loss of trust. “Even if the financial report is particularly ugly and the stock falls, do n’t lie. SEC investigates well. ”
(At the request of the interviewee, Yang Bo and Wei Peng became pseudonyms.)