Many Stocks Closed Down, Shenzhen Shares Fell Smaller.

The reform of B shares can refer to the practice of A share reform.

The problem of B shares should not be delayed. It is urgent for the regulatory authorities to come up with great wisdom to solve them.

Of course, as an unprecedented systematic project in China's stock market, we should give full consideration to all kinds of difficult factors in the process of solving the B-share problem, take into account the interests of all parties, and embody the principles of three principles.

With the attitude and acquiescence of the regulatory authorities, there are some new trends in the long-standing B-share market. Although they are independent cases, if they are combined in series, the road map of the long term deep embarrassment B-share market seems to be clear.

This Monday's move made the long marginalized B-share market once again become the focus of attracting investors and analysts. On the same day, the B index of Shanghai stock market was the largest drop of nearly 7%, and many stocks closed down, and the Shenzhen stock market with better overall performance had a smaller decrease.

The reason for the change in B share market is that the RMB devaluation is relatively fast in recent years, which leads to the decline of RMB asset prices marked by foreign currency, non resident account tax investigation or investor selling, and the MSCI emerging market index or part of the A share and the weight reduction of B shares, resulting in the pfer of foreign capital institutions and so on.

These factors are somewhat far fetched, because the depreciation of the renminbi is not the recent start, but a continuing phenomenon since the beginning of last year.

As for tax related investigation and institutional adjustment, it is a kind of "Gudong".

After opening to the domestic individual investors in 2001, the splendor of the B-share market was short-lived, and has been severely marginalized since then.

There are no new shares issuing, and there are few cases of listed companies offering B-shares refinancing. The two level market pactions are very inactive. Many scholars and experts believe that the historical mission of B-share market has been completed.

There are three main types of schemes that have been implemented, announced or suspended in the B-share Listed Companies: 1) listed companies buy back and write off B shares, such as Changan, Lu Tai, and south glass.

2) B share pfer

Programmes such as Zhongji, Vanke, and Li Zhu.

3) B share pfer to A shares, such as the implementation of Zeng Neng holdings to absorb the merger of Dong electric B shares, new town holdings to absorb new B shares, China Merchants Shekou absorb merger investment real estate, as well as the implementation stage of the city voted to absorb the merger of B shares and the separation of environmental protection business, Nanshan holding merger deep base B and other cases.

In a number of opinions issued by the State Council on further promoting the healthy development of the capital market in 2014, it explicitly called for "steady exploration of B-share market reform", which made investors full of expectation for the B-share market.

But in the past two years, with the change of stock market, few companies have completed the reform. Some cases have been delayed for a long time or for a variety of reasons.

To steadily explore and solve B-share problems as early as possible, we need to think big and take great responsibilities.

Because the reform not only has the interests of circulating shareholders and non tradable shareholders, large shareholders and small shareholders, but also involves the interests of A shareholders and overseas shareholders of various identities.

Therefore, in the reform process of B-share market, policy game, interest game and potential legal risks will be more complicated.

When designing a solution to the B-share issue, it should not only be active and sound, but also conducive to the development of the securities market; not only consider the interests of the B-share shareholders, but also plan in the context of the overall layout of China's securities market and the reform of the foreign exchange management system.

The author believes that B shares reform can be based on the practice of A share reform, and clarify the following basic principles, so as to stabilize market expectations and ensure the smooth progress of reform.

(1) no new legacy can be created.

We can not create a new legacy for solving a problem.

In formulating relevant policies, it is necessary to do more research and Discussion on the interests of all parties in B-share market, the particularity of shareholder structure, and the legal basis for reform, so as to achieve a smooth pition.

(2) the negative impact of A shares has been minimized.

At the same time, A and B shares are issued.

Stock prices are basically higher than B shares, and some are several times higher.

If the direct merger is likely to lead to A share price fluctuations, when considering the merger of A and B shares, we need to consider the smooth pition as far as possible, and make some plans to control the possible impact within a certain range.

(3) maximize the interests of shareholders of B-shares.

B shares should be converted into A shares and should not be damaged by the interests of B-share shareholders.

In the choice of solutions, avoid as much as possible policy factors and the cancellation of the market itself, resulting in a new round of "blood loss" for B-share investors.

Based on the above principles, the author put forward his own AB share merger plan in the past few years, which can be simply summed up as "the right of placing A shares and +A shareholders in the form of cash options + B shares converted into limited sales conditions".

The core of the plan is: first, determine a fair price, and provide cash options for the third directional B-share shareholders.

The two is to abandon the exercise of the option to exercise B shares will be automatically converted to a limited period of sale of A shares, the length of the sale depends on the size of the AB stock price difference.

Three is the implementation of cash options.

The existing A share shareholders will be allotted according to the proportion of shares and the allotment shares will have a limited sale period.

The four is placing the remaining shares by the cash option provider.

Five, pure B shares, which do not exist A shares, can be used as a direct pfer panel.

The related merger plan is a major motion. It should be convened by a general meeting of shareholders. The votes of A and B shareholders should be voted separately and counted separately. They should be more than 2/3 of the voting shareholders.

In addition to "pure B shares" directly pferring to A share circulation, other B-share shareholders temporarily lose their circulation rights, and some shareholders are unwilling to hold A shares (or their identity does not meet the requirements of A shareholders). They should provide them with cash options as the second choice.

The price of cash options generally refers to the historical valuation of B shares and the stock price level in the past few years, between the price of A and B shares. Its setting is the result of testing the investment bank's pricing power and satisfying the interests of all parties.

According to the company's different situations, cash options can be provided by listed companies, controlling shareholders of listed companies, securities dealers and independent third parties.

The above plan is simple and feasible. It neither creates new legacy problems, but also minimizes the negative impact of A shares and maximizes the interests of B-share shareholders.

After the implementation of the scheme, B shares will be fully integrated into the A share market, and B shares will be solved.