444 listed companies in Shanghai ushered in policy support for mergers and acquisitions. On December 10, the Shanghai Municipal Government issued the "Shanghai Action Plan for Supporting the M&A and Restructuring of Listed Companies (2025-2027)" (hereinafter referred to as the "Plan"), with a total of 12 articles, comprehensively supporting listed companies to become bigger and stronger through mergers and acquisitions, focusing on supporting the three leading industries.

The

main goal of the plan is to strive to implement a number of representative M&A cases in key industries by 2027, cultivate about 10 internationally competitive listed companies in key industries such as integrated circuits, biomedicine, and new materials, form a scale of 300 billion yuan in M&A transactions, activate total assets of more than 2 trillion yuan, gather 3~5 professional M&A fund managers with strong industry influence, greatly improve the M&A service capabilities of intermediary institutions, and play an active role in M&A service platforms.

The Plan also mentions key points such as cultivating M&A funds, improving investment banking service capabilities, and building M&A service platforms, including promoting the transformation and upgrading of traditional industries, establishing a discovery and reserve mechanism for M&A targets, accelerating the merger of securities companies and building a first-class investment bank, and accelerating the cultivation of agglomeration M&A funds.

Wind data shows that as of December 10, there were 444 listed companies in Shanghai, with a total market value of 9.38 trillion yuan, including 161 companies with a market value of 10 billion yuan and 17 companies with a market value of 100 billion yuan 688981. SH) ranks first in terms of market capitalization. In 2024, there will be 8 new listed companies in Shanghai, and INTSIG (688615. SH) has the largest market capitalization. According to the attributes of the company, among the 444 listed companies, there are 87 listed local state-owned enterprises and 246 private enterprises in Shanghai. Due to the inherent advantages of restructuring of state-owned companies, the next M&A plan of the 87 Shanghai local state-owned enterprises will be the focus of market attention.

Focus on the three leading industries of integrated circuits, biomedicine and artificial intelligence

At the end of September, the China Securities Regulatory Commission (CSRC) issued the "Six Mergers and Acquisitions", and the A-share market entered a new round of mergers and acquisitions. The policy aims to increase support listed companies to become bigger and stronger through mergers and acquisitions, and transform and upgrade to the direction of new quality productivity. Over the past two months, M&A plans in emerging technology fields have been continuously implemented, and the semiconductor industry has set off a wave of mergers and acquisitions.

It can be seen that the mergers and acquisitions proposed in the "Plan" are mainly divided into two paths, the first is to focus on the new quality of productivity to strengthen the chain and supplement the chain, and support listed companies to acquire high-quality unprofitable assets that help strengthen the chain and improve the level of key technologies. In key areas such as integrated circuits, biomedicine, and artificial intelligence, sort out the list of main enterprises in the listing chain of key industries.

With the opening of the Science and Technology Innovation Board five years ago, a number of integrated circuit, biomedicine and artificial intelligence companies were listed, consolidating its core competitiveness while continuously strengthening R&D investment. The reporter combed and showed that the 444 listed companies in Shanghai, according to the first-class industry of Shenwan, the number of companies in the three major industries of biomedicine, electronics and computer ranked first, with 52, 51 and 40 respectively, and the total market value of biomedical and semiconductor listed companies alone exceeded 2 trillion yuan.

The total market value of 52 biopharmaceutical companies is 651.65 billion yuan, covering multiple sub-sectors such as medical devices, biological products, medical services, innovative drugs, and chemical pharmaceuticals. United Imaging Medical (688271. SH) will be listed on the Science and Technology Innovation Board in 2022 and is a leading high-end medical device in China; Shanghai Pharmaceutical (601607. SH), Fosun Pharma (600196. SH) has a market capitalization of more than 70 billion yuan. Junshi Biosciences (688180.HK) SH), Allist (688578. SH), Sunshine Guojian (688336. SH) and other companies with a market value of 10 billion yuan, mainly engaged in innovative drugs.

In the integrated circuit industry, Shanghai is the vanguard of the country, with the most complete industrial chain, the highest technical level and the strongest comprehensive competitiveness, with listed companies covering wafer manufacturing, materials, equipment, design, packaging and testing, etc., with a total market value of about 1.68 trillion yuan. SMIC and Hua Hong Corporation (688347. SH) two mainland wafer manufacturing "duo" are both in Shanghai, and China Micro Corporation (688012. SH), Weir shares (603501. SH) has a market capitalization of more than 100 billion yuan. Semiconductor companies such as Shanghai Silicon Industry, Montage Technology, Shengmei Shanghai, Geke Microelectronics, and Fudan Microelectronics are also leaders in their respective fields.

The

development of the leading industry is inseparable from the support of long-term patient capital. In July, Shanghai established the "Shanghai Three Leading Industries Fund of Funds", which is a limited partnership, corresponding to the three key directions of integrated circuits, biomedicine and artificial intelligence, with a total scale of about 89 billion yuan, and the corresponding scale of the three major industries is 45.001 billion yuan, 21.501 billion yuan and 22.501 billion yuan respectively, with Shanghai SDIC Pilot Private Equity Fund Management Co., Ltd. as the fund manager.

To make good use of the leading industry fund, the "Plan" proposes to accelerate the cultivation of agglomeration M&A funds, introduce professional track market-oriented M&A fund managers, attract market-oriented M&A funds, and set up fast tracks for eligible equity investment funds, make good use of 10 billion yuan of integrated circuit design industry M&A funds, and set up 10 billion yuan of biomedical industry M&A funds. Government investment funds can participate in the capital contribution of M&A funds through ordinary shares, preferred shares, convertible bonds, etc., and make appropriate profits.

Promote the transformation and upgrading of traditional industries and build a first-class investment bank

The

second path of mergers and acquisitions specified in the Plan is to promote the transformation and upgrading of traditional industries. Encourage listed companies in traditional industries such as modern service industries and professional services, including finance and logistics, to carry out mergers and acquisitions and mergers in the same industry, upstream and downstream, and reasonably enhance industrial concentration. Carry out cross-industry mergers and acquisitions around industrial upgrading and seeking the second growth curve, inject high-quality assets, and enhance investment value.

The reporter combed and showed that Shanghai's traditional manufacturing industry is mainly concentrated in the five major industries of machinery and equipment, basic chemicals, power equipment, automobiles and transportation, and the number of listed companies is 37, 29, 26, 26 and 21 respectively. In addition, there are 18 real estate, 15 building decoration, and 15 commercial and retail stores.

In

the financial industry mentioned in the plan, there are four main banks in Shanghai, namely Shanghai Pudong Development Bank, Bank of Shanghai, Bank of Communications and Shanghai Rural Commercial Bank; There are 12 non-bank financial institutions, including 7 securities firms, 1 insurance company, and 4 diversified financial institutions.

During the year, Haitong Securities (600837. SH) and Guotai Junan (601211.SH) have attracted much attention in the market, and the transaction has been approved in principle by the Shanghai State-owned Assets Supervision and Administration Commission. According to the transaction plan (draft), Guotai Junan intends to issue A shares to a state-owned company to raise matching funds of no more than 10 billion yuan, the issue price is 15.97 yuan per share, and the number of A shares issued does not exceed 626 million shares (including the number of shares). Among them, the funds to be used for the international business, transaction and investment business, and supplementary working capital of the merged company shall not exceed 3 billion yuan, and the funds to be used for digital transformation construction shall not exceed 1 billion yuan.

The plan proposes to improve the service capacity of intermediary institutions, accelerate the merger of securities companies, and build a first-class investment bank. Guide investment banks to set up a comprehensive service team for mergers and acquisitions, and link up industry research, investment, investment banking, investment research, financing docking, legal services, evaluation and auditing and other sectors to provide comprehensive services for the whole life cycle of M&A transactions.

In terms of the logistics industry, there are 8 listed companies in Shanghai, and the largest market value is China Eastern Airlines Logistics (601156. SH）。 Changlian Co., Ltd. (603648. SH), Changjiang Investment (600119. SH) and Shanghai Yashi (603329.SH) are three logistics companies that are local state-owned enterprises in Shanghai.

In order to promote the realization of the goal of mergers and acquisitions, the Plan proposes to build a comprehensive M&A service platform, strengthen the cooperation between the government and the market, create an M&A resource agglomeration area with strong professional management capabilities, strong policy support and a high degree of factor agglomeration, build a "one-stop" M&A public service platform and a third-party market-oriented M&A service platform, gather and integrate resources such as banks, securities, funds, and asset appraisal institutions, and provide all-round services such as demand mining, matching transactions, and asset transfer. Regularly carry out M&A salons, and increase counseling and training, roadshow promotion, and financing docking. Strengthen policy interpretation, establish regular communication and liaison mechanisms with listed companies, intermediaries and other business entities, and support the implementation of excellent typical cases.