The Rumors and Clarifications Surrounding China Galaxy and CICC Merger
Brokerage stocks have been making waves in the market, with both CICC and China Galaxy hitting their daily limits, and other companies such as Dongxing Securities, Harbin Investment Co., Ltd., Huaxin Co., Ltd., and Shenwan Hongyuan strengthening rapidly. Amidst this buzz, rumors have been circulating about a possible merger between CICC and China Galaxy Securities, prompting the two companies to issue a joint clarification announcement.
On November 13, both companies stated that they have not received any official information regarding the merger rumors from government departments, regulatory agencies, or the companies’ controlling shareholders and actual controllers. China Galaxy further emphasized that there are no major undisclosed matters or information concerning the rumored merger. These clarifications come amidst major personnel adjustments within both companies, adding to the speculation surrounding a potential merger.
It was announced on October 22 that both CICC and China Galaxy Securities would undergo leadership changes. Chen Liang, the former chairman of China Galaxy Securities, will be taking over as chairman and legal representative of CICC. This follows his resignation from China Galaxy Securities due to work arrangements. Notably, Wang Shenglin, the current president of China Galaxy Securities, will be taking over as the party committee secretary and chairman.
These changes in leadership have sparked discussions about the potential impact of a merger between the two securities firms. The concept stocks of relevant securities companies may receive focus from the market, but before specific measures are introduced, there are warnings about potential risks. However, industry observers note that historically, merged securities companies have often seen benefits in terms of business development. Additionally, the move by the China Securities Regulatory Commission is expected to have a positive impact on the development of the securities industry, amidst increasing competition and a trend of industry consolidation in recent years.
Despite the ongoing speculation and uncertainties, both CICC and China Galaxy Securities continue to operate and perform in the market, with China Galaxy achieving a year-on-year increase in net profit attributable to shareholders, and CICC facing a decrease in net profit but with its new leadership in place. As the market awaits further developments and official announcements, the potential merger and its implications remain a topic of interest for investors and industry experts alike.