China Revises Rules To Encourage Stake Buys


The China Securities Regulatory Commission (CSRC) revised rules governing stake increases by shareholders owning more than 30 percent of listed companies, reducing the lockup period for share purchases of up to two percent per year, from 12 months to six months, reports China Securities Journal.

According to an insider, the move is intended to encourage the purchase of shares at reasonable prices.

In order to avoid having to make a tender offer, a number of shareholders had stopped share purchases as soon as they held a 30 percent interest.

Such shareholders are actually eligible to buy stakes of up to two percent per year without trigging a tender offer, added the  source.

Under the new rules, major shareholders with stakes of more than 50 percent are required to make public filings a day after share buys of one percent are made.

According to Yingda Securities, major shareholders of 316 companies bought shares valued at a total of seven billion yuan from the secondary market during the period between December 2011 and January 2012.

Shares of Haitong Securities (600837) fell 0.47 percent to close the morning session at 8.52 yuan per share.


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