Reuters (August 22)
The “boom-to-bust saga” of China Evergrande Group drew closer to the end with its formal “delisting from the Hong Kong stock exchange on Monday,” which as the largest by market value and volume in recent years.” For investors, “the journey has been anything but grand.” After achieving a $9 billion market cap in its 2009 IPO, Evergrande rocketed ahead, growing “more than five-fold to $51 billion eight years later only to plummet to earth,” with it’s current value approximately $282 million and creditor claims of approximately $45 billion. “The company’s journey from stock exchange darling to a pariah in the financial markets is a cautionary tale of unbridled debt-fuelled expansion in the world’s second-largest economy.”
Tags: Boom, Bust, Cautionary tale, China. Evergrande, Creditor claims, Debt-fuelled, Delisting, Expansion, Hong Kong, Investors, IPO, Market value, Pariah, Stock exchange, Volume
Institutional Investor (August Issue)
“Facing an image problem,” many Chinese companies are retreating from U.S. exchanges. “Frustrated by low valuations and investor skepticism, Chinese companies are increasingly considering delisting from U.S. stock exchanges.” Since 2009, 24 Chinese companies have delisted, often going private, from the NYSE and Nasdaq. Much investor skepticism is directed at companies that utilized reverse mergers to attain their listing, thereby avoiding the scrutiny that would accompany a normal IPO, but the skepticism has tainted even Chinese companies with solid financials.
Tags: China, Companies, Delisting, Image, Investors, IPO, Listing, Nasdaq, NYSE, Private, Reverse mergers, Scrutiny, Skepticism, Stock exchanges, U.S., Valuations
