Media said NASDAQ would set a threshold for IPO Financing, making it more difficult for Chinese enterprises to list

category:Finance
 Media said NASDAQ would set a threshold for IPO Financing, making it more difficult for Chinese enterprises to list


Reuters screenshot

According to sources, NASDAQs new rules will require companies to raise more than $25 million in IPOs, or at least a quarter of their post IPO market value.

This is the first time NASDAQ has set a minimum IPO size. According to Luft, a financial market data provider, 40 of the 155 Chinese companies listed on NASDAQ since 2000 have raised less than $25 million in IPOs.

According to Reuters, Chinas small and medium-sized enterprises are seeking IPO because they allow founders and sponsors to cash out and acquire dollars, which are difficult to obtain in Chinas domestic market. At the same time, the company can persuade banks to lend money and obtain local subsidies as a NASDAQ listed company.

Last year, NASDAQ introduced some listing restrictions to try to curb the IPO of small and medium-sized enterprises in China, the report said. Because these companies usually have few stock transactions and most of them are in the hands of a few insiders, the low liquidity makes them lose their appeal to large institutional investors, which NASDAQ wants to cater to.

The tightening also reflects exchange concerns about Chinese companies IPO in the US. In particular, the report mentions the financial fraud of Ruixing coffee, which went public on NASDAQ last May.

The new rules will also require an audit of the company to ensure that its international operations meet global standards, sources said. NASDAQ will also inspect small US companies that audit the accounts of Chinese listed companies. Reuters said several Chinese listed companies have been accused of accounting irregularities since 2011. Last week, trump expressed similar wishes in an interview with Fox business channel. But he pointed out that Chinese companies may choose to list in London or Hong Kong instead. At the end of the report, the US Securities and Exchange Commission (SEC) plans to hold a round table this summer to invite companies, auditors, consultants and other parties to participate in a special discussion on IPO and accounting information disclosure of foreign companies. Source: responsible editor of observer network: Wang Xiaowu_ NF

The new rules will also require an audit of the company to ensure that its international operations meet global standards, sources said. NASDAQ will also inspect small US companies that audit the accounts of Chinese listed companies. Reuters said several Chinese listed companies have been accused of accounting irregularities since 2011.

Last week, trump expressed similar wishes in an interview with Fox business channel. But he pointed out that Chinese companies may choose to list in London or Hong Kong instead.

At the end of the report, the US Securities and Exchange Commission (SEC) plans to hold a round table this summer to invite companies, auditors, consultants and other parties to participate in a special discussion on IPO and accounting information disclosure of foreign companies.