"Ten-Year Alliance" Faces Turbulence: Hunan Finance Stock's Absorption Merger of Dazhihui Suddenly Terminated

On March 15, Xiangcai Securities and Dazhihui both announced that the transaction involving Xiangcai Securities’ share swap to acquire Dazhihui and the related fundraising has been suspended due to the valuation data in the filing documents expiring on March 14. The Shanghai Stock Exchange has suspended review of this transaction in accordance with regulations.

Both companies stated that this suspension will not have a significant adverse impact on the transaction. Their operations are normal, and they are actively updating valuation data, financial data, and application documents. Once the updates are completed, they will promptly submit the revised materials and request to resume review.

However, despite both companies saying the impact is minor, the market has sparked considerable discussion about a potential “restructuring delay.”

In fact, suspensions of review due to “data validity period” issues are not uncommon in the A-share market, especially in the first quarter (January-March), when old and new financial data are exchanged. According to incomplete statistics by 21st Century Business Herald, since 2026, at least 15 companies including Shitou Shares, Yingli Shares, Huamao Technology, Bohai Auto, and ST United have announced suspensions due to expired financial or valuation reports.

From past cases, companies typically resume review after 1-2 months of updating and supplementing data. Some companies, with faster procedures, have applied for review resumption within just a few trading days.

From the termination of Dazhihui’s planned acquisition of Xiangcai Securities in 2015 to the acceptance of Xiangcai Securities’ proposed share swap to acquire Dazhihui in 2025, this decade-long “reunion” has attracted market attention.

Looking ahead, in the context of increasing mergers and acquisitions in the securities industry, industry insiders generally hold a positive outlook, expecting this restructuring to establish a new “traffic + license” internet brokerage model.

Data Expiry Triggers Suspension of Review

According to the announcement, on March 14, Xiangcai Securities and Dazhihui received notices from the Shanghai Stock Exchange that the valuation data submitted in their application documents had expired and needed updating. The SSE suspended review of this transaction in accordance with the “Rules for Major Asset Restructuring of Listed Companies.”

Further details indicate that the valuation report’s validity expired on March 14, 2026, exceeding the maximum 12-month validity period.

Additionally, the restructuring report referenced the most recent audited financial statements as of June 30, 2025. Under the six-month validity rule, these data will expire on March 31, 2026.

Both companies stated that this suspension will not significantly affect the transaction, and their operations remain normal.

Regarding next steps, they said that they and relevant intermediaries are actively working on updating valuation data, financial data, and application documents. Once completed, they will promptly submit the updated materials to the SSE and request to resume review.

Common Data Expiry “Review Suspension” in Q1

Although both companies said the impact is minor, the market has discussed the possibility of “restructuring delays.”

Is it common for mergers and acquisitions to be suspended due to “data validity” issues?

In fact, such situations are not rare in the A-share market, especially in the first quarter (January-March). According to incomplete statistics by 21st Century Business Herald, since 2026, over 15 companies including Shitou Shares, Yingli Shares, Huamao Technology, Bohai Auto, and ST United have announced suspensions due to expired financial or valuation reports.

For example, Bohai Auto planned to acquire four companies owned by Haina Chuan, but the review was suspended twice this year—once on January 31 and again on February 28—due to expired audited financial data and valuation reports.

Industry insiders note that according to regulations on major asset restructuring, the most recent audited financial data is valid for six months after the reporting date. If the transaction involves issuing shares, the validity period can be extended under special circumstances, but not beyond three months. If data is not updated within this period, the exchange will suspend review.

From the company’s perspective, the submitted financial data are often based on mid-year or year-end figures from the previous year. After a 6-9 month review cycle, data often become outdated at the start of the following year.

From the auditor’s perspective, Q1 is also the peak period for annual report audits, leading to intensive audit work and potential delays in data updates.

Therefore, in Q1, it is common to see situations where “old data expire while new data are still under audit,” causing temporary review suspensions in many M&A transactions.

How long do such suspensions typically last before review resumes?

Past cases show that companies usually resume review after 1-2 months of data updates and supplementation. Some companies, with faster procedures, have applied for review resumption within just a few days.

For example, Wuhan Holdings’ plan to acquire 100% of Wuhan Municipal Institute’s equity was suspended on December 31, 2025, due to expired financial data. After extension audits and document updates, the review was resumed on February 28, 2026—about two months later.

Another example is Chuangyuan Xinke’s plan to acquire 100% of Shanghai Weiyu Tiandao Technology, which was suspended on January 30, 2025, due to expired financial data. The company applied for review resumption on February 9 and received approval on February 11, just 10 days later.

“Decade-long” Reunions and Market Focus on “Traffic + License” Model

Returning to the transaction where Xiangcai Securities will acquire Dazhihui via share swap, the market’s discussion is also related to the long timeline of this deal.

This is not the first attempt at a “marriage” between the two companies. In 2015, Dazhihui planned to acquire Xiangcai Securities for 8.5 billion yuan, which was officially accepted by the SSE but was soon suspended due to Dazhihui’s suspected disclosure violations and investigation.

Ten years later, the roles have reversed: Xiangcai Securities (renamed after being acquired by Hegang) is now absorbing Dazhihui. This “reunion” has attracted significant market attention.

From the initial disclosure of the merger plan on March 28, 2025, to the suspension on March 14, 2026, due to expired documents, nearly a year has passed. For such a high-profile major restructuring, this duration tests market patience and attention.

Additionally, in recent months, both Dazhihui and Xiangcai Securities have faced legal issues.

In November 2025, a retail shareholder filed a lawsuit against Dazhihui over procedural compliance in the restructuring. The suit was quickly withdrawn and did not affect the process, but it sparked discussions about the transaction’s legality.

Xiangcai Securities also faced a case related to a 30 billion yuan “Chengxing” incident, which saw new developments in February. The company disclosed that Yunnan Trust filed a civil trust dispute seeking about 343 million yuan in damages and joint liability from Xiangcai Securities. The case is now under retrial, with no final resolution yet.

Given these negative events, even routine review suspensions can cause investor anxiety about prolonged uncertainties.

However, industry insiders remain generally optimistic about this decade-long “reunion.”

They believe that the long interval indicates mutual recognition of long-term business complementarity. After previous setbacks, both sides are likely to adopt more cautious and pragmatic integration strategies this time, enhancing transaction stability.

From their current fundamentals, the “safety cushion” for this restructuring appears solid.

In 2025, Xiangcai Securities’ core entity is expected to generate approximately 1.955 billion yuan in revenue, up 28.8%, with net profit around 553 million yuan, a 157.5% increase. Dazhihui’s 2025 forecast shows a net loss of 34-50 million yuan, narrower than 2024, indicating improved performance despite still being in loss.

Industry analyst Xia Miang from Pacific Securities suggests that combining Xiangcai Securities’ full license with Dazhihui’s millions of active users could create a new “traffic + license” internet brokerage model.