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Bourse limits trading suspensions to 30 days for restructuring
By Xu Shenglan (chinadaily.com.cn)
Updated: 2008-05-21 17:20 A stock trading suspension can last no longer than 30 days before a public firm announces a major asset restructuring plan, according to a memorandum issued by the Shanghai Stock Exchange last night. With a major asset restructuring plan under discussion, a listed company should apply for a trading suspension of its stock before releasing relevant materials to its directors for a board meeting. The directorate should also pledge a 30-day limit for the suspension, according to the guide. Moreover, if a company expects its stock to be suspended from trading for more than five days in a row, it should releases reports at least once a week to inform investors of negotiations, approval, and pricing issues as well as uncertainties involved in the restructuring. The memorandum also requires listed companies to keep due secret during restructuring, warding off information leaks before the formal announcement. Meanwhile, the listing department of the bourse will not accept any trading suspension applications during trading hours, nor documents related to restructuring moves. An expert with the exchange told China Securities Journal that from now on, listed companies should carry out major asset reorganizations as the memorandums required. The exchange is responsible for scrutinizing the integrity of information disclosure files required and the authentication provided by independent financial advisors. (For more biz stories, please visit Industries)
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