News summary
Guolian Securities plans to invest 11freewsopchips2021.31 yuan/share to purchase 100% shares of Minsheng Securities, and the matching funds raised by share issuance during the same period did not exceed 2 billion yuan to help the development of Minsheng Securities business. Guoxin Non-Bank believes that it is expected to be promoted to the top 20 in the industry after the merger, maintains the company's "buy" rating, and is bullish on its potential in capital market reform.
Newsletter text
[Guolian Securities initiated the acquisition of Minsheng Securitiesfreewsopchips2021actions]
Guolian Securities disclosed a trading plan to acquire all shares of Minsheng Securities at a price of 11.31 yuan per share.
The acquisition involves a total of 46 trading parties, including Guolian Group and Fengquanyu, and aims to pay the transaction consideration through the issuance of shares.
At the same time, Guolian Securities also plans to issue shares to no more than 35 specific investors, aiming to raise matching funds of no more than 2 billion yuan.
The funds raised will be specially used to promote the expansion of Minsheng Securities 'business.
Guoxin Non-Bank's analysis believes that the offering price is 8.13% higher than the closing price of Guolian Securities on the trading day before the suspension of trading, indicating optimism about long-term expectations for integration.
The combined net assets of Guolian Securities will reach 33.9 billion yuan, making it expected to become the top 20 in the industry.
The merger of Guolian Securities and Minsheng Securities has opportunities for integration in brokerage and investment banking businesses, especially in the investment banking business of Minsheng Securities.
Wind data shows that Minsheng Securities ranks fifth in the industry in the number of IPOs issued in 2023, with a market share of 5.65%, while Guolian Securities ranks 22nd in the number of IPOs issued, with a market share of 1.13%.
The branches of Minsheng Securities have a wide coverage in Henan, while Guolian Securities has a high share in Wuxi and southern Jiangsu markets. After the merger, the two are expected to achieve complementary advantages.
Analysts maintain their earnings forecast for Guolian Securities, predicting net profit attributable to the parent company from 2024 to 2026 to be 880 million yuan, 1.01 billion yuan, and 1.09 billion yuan respectively, with year-on-year increases of 30.3%, 15.5%, and 7.9% respectively.
Against the background of continued capital market reform and securities firms actively promoting public offering management business, the company's comprehensive strength and ROE are expected to improve, so analysts gave a "buy" rating.
It should be noted that market fluctuations, financial regulatory policies, market competition and the promotion of innovative business may bring uncertainty to securities firms 'performance and valuation.
