Resigning to cash in shares
By Louise Ho |
February 2, 2012, Thursday
|
Print Edition
Print Edition
WHILE retail stock investors, with hopes of striking it big, saw their fortune lost on the Chinese mainland's market, some senior executives of listed firms became millionaires overnight.
In January, 63 senior managers of listed firms in Shanghai and Shenzhen quit and sold shares in their firms, company statements have showed.
The wave of senior managers resigning and selling shares is not new. In 2010, 752 senior managers from A-share listed companies resigned. The number surged to 1,264 last year.
Some listed companies even saw their management resign en mass. For example, Minsheng Investment said on January 9 that its top management - board chairman, general manager, board secretary and chairman of board of supervisors - all resigned simultaneously.
Xu Fuguang, a strategist at Xiangcai Securities, said that due to the low cost of holding shares, senior managers have a strong incentive to sell them off in a weak market.
For example, Wang Jun, board secretary of Liaoning-based China Dajin Heavy Industry Corp, earned 6 million yuan by selling 225,000 shares at 26.75 yuan each after he quit due to "personal reasons" on August 4.
Financial data provider Wind said that until December 16, major shareholders in 770 listed firms have reduced shareholdings and subsequently cashed in an estimated total of 95.6 billion yuan (US$15.2 billion).
The main reason the senior managers resigned is to cash in shares that they were holding, analysts said.
The mainland market has a "lock-up period," during which senior executives in a company cannot sell shares within a period of one to three years after an IPO. But if they resign, they can sell shares, which they bought at a low price, in six months.
Analysts said the government should improve regulations.
In January, 63 senior managers of listed firms in Shanghai and Shenzhen quit and sold shares in their firms, company statements have showed.
The wave of senior managers resigning and selling shares is not new. In 2010, 752 senior managers from A-share listed companies resigned. The number surged to 1,264 last year.
Some listed companies even saw their management resign en mass. For example, Minsheng Investment said on January 9 that its top management - board chairman, general manager, board secretary and chairman of board of supervisors - all resigned simultaneously.
Xu Fuguang, a strategist at Xiangcai Securities, said that due to the low cost of holding shares, senior managers have a strong incentive to sell them off in a weak market.
For example, Wang Jun, board secretary of Liaoning-based China Dajin Heavy Industry Corp, earned 6 million yuan by selling 225,000 shares at 26.75 yuan each after he quit due to "personal reasons" on August 4.
Financial data provider Wind said that until December 16, major shareholders in 770 listed firms have reduced shareholdings and subsequently cashed in an estimated total of 95.6 billion yuan (US$15.2 billion).
The main reason the senior managers resigned is to cash in shares that they were holding, analysts said.
The mainland market has a "lock-up period," during which senior executives in a company cannot sell shares within a period of one to three years after an IPO. But if they resign, they can sell shares, which they bought at a low price, in six months.
Analysts said the government should improve regulations.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
