Eighteen IPO Applications Halted in Wake of GF Securities’ Sponsoring Ban
What’s new: The IPO application process of 18 companies has been ended or suspended in recent months since their sponsor GF Securities Co. Ltd. was suspended from securities sponsoring due to its role in a client’s fraud case, according to data from the Shanghai and Shenzhen bourses as well as the top securities regulator.
Among the companies, LED packaging firm Shenzhen Kinglight Co. Ltd. (link in Chinese) and auto-parts maker Jiangyin Pivot Automotive Products Co. Ltd. are the only two that have terminated their IPO processes.
Several other clients of GF Securities have chosen to end sponsorship or prelisting tutoring contracts.
What’s the background: In July, GF Securities was banned from the securities-sponsoring business for six months and from bond underwriting for a year over its involvement in a case of financial fraud amounting to 88.7 billion yuan ($12.7 billion) by drugmaker Kangmei Pharmaceutical Co. Ltd.
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