SAIC's overall listing initial plan report

The overall listing of the SAIC Group has finally taken the first step. On November 28th, Shanghai Automotive (600104.SH) announced the change of shareholder's announcement. "The largest shareholder of Shanghai Automotive Industry Group, as a result of restructuring and reorganization, intends to use the held auto assets as a capital contribution, and initiates the establishment of SAIC Motor Group Co., Ltd., which will contribute capital. Including its approximately 2.3 billion state-owned shares held by Shanghai Automotive (70% of the total share capital), Shanghai Automotive’s largest shareholder will be changed to SAIC Motor Corporation, but SAIC remains the actual controller of the company. Equity change has been approved by the Shanghai State Assets Supervision and Administration Commission, but it still needs the approval of the State Council and the CSRC's exemption from the tender offer.” Affected by the announcement, on November 28, Shanghai Automotive closed at 5.64 yuan, down 1.9%. After the SAIC Group shares are established, they will hold the shares of the holding companies, joint ventures, joint ventures, and joint-stock companies originally held by the SAIC Group and related to the automotive industry. At the same time, SAIC Motor’s shares replaced SAIC as a shareholder of Shanghai Automotive. At the 2003 Shanghai Automotive Shareholders Meeting, Hu Maoyuan, President of SAIC Motor, particularly mentioned that the group will achieve overall listing in the next two years and said that it is considering three options: First, the group level will introduce strategic investors to achieve equity diversification. Afterwards, it seeks to go public as a whole; second, it is directly listed overseas; and thirdly, it uses existing A-share listed companies to achieve overall listing by means of asset reorganization. At present, the most common argument is that Hong Kong and New York will be listed at the same time, and plans to raise funds of 50 billion yuan, or about 6 billion US dollars, of which 2 billion will be raised in Hong Kong. In addition, the selection of underwriters has also been settled. BOC International, Deutsche Bank, Merrill Lynch, and Morgan Stanley will be responsible for their global IPO underwriting. It is understood that the restructuring of SAIC Motor has started and the initial plan for the overall listing has been reported to the municipal government. However, in addition to the announcement of changes in the company's equity, other details about the overall listing of SAIC Group are still kept confidential. According to industry analysts, as of the end of last year, SAIC's total assets were approximately 33.1 billion yuan, most of which were assets related to automobile production. At present, all auto assets must be invested in newly established joint-stock companies. The total assets of the new company may be about 30 billion yuan. In addition, in addition to Shanghai Auto’s equity, SAIC Motor Group has a number of high-quality assets, including Shanghai Volkswagen, Shanghai General Motors and some joint venture parts and components manufacturing enterprises. If the assessment increases, then SAIC Motor’s assets will be larger. . Some analysts believe that from the SAIC Group restructuring, the Shanghai Auto's equity is absorbed by the new company. Therefore, SAIC Motor should not adopt the overall listing model like WISCO. In fact, compared with the other two overall listing methods, Wuhan Iron and Steel Model is in the best interest of Shanghai Auto. Therefore, analysts believe that if SAIC's overall listing continues to be uncertain, it will have a negative impact on Shanghai Auto's share price.
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