"Decade-Long Alliance" Faces New Turbulence: Xiang Finance's Absorption and Merger of Dazhihui Suddenly Halted

Source: 21st Century Business Herald Author: Liu Xiafei

On March 15, Xiangcai Securities and Great Wisdom both announced that the transaction involving Xiangcai Securities’ share swap to acquire and merge with Great Wisdom, along with fundraising for supporting funds, 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 the suspension will not have a significant adverse effect on the transaction. Their operations are normal, and they are actively working on updating valuation data, financial data, and application documents. Once the updates are completed, they will submit the materials as soon as possible and apply to resume review.

However, despite both companies saying the impact is “not significant,” there has been considerable market discussion about a possible “restructuring suspension.”

In fact, delays in 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 of mergers and acquisitions review 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, acting more quickly, have applied for review restoration within just a few trading days.

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

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

Data Expiry Triggers Review Suspension

According to the announcement, on March 14, Xiangcai Securities and Great Wisdom received a notice from the Shanghai Stock Exchange that the valuation data submitted in their application documents had expired and needed updating. Under the relevant regulations of the Shanghai Stock Exchange’s review rules for major asset restructuring, the review of this transaction has been suspended.

Further details in the announcements show that the valuation report’s validity period ended on March 14, 2026, which has exceeded the maximum 12-month validity.

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

Regarding the impact of the suspension, both sides stated that it would not significantly affect the transaction, and their operations are normal.

For the next steps, both companies said they are actively working with intermediaries to update valuation data, financial data, and application documents. Once completed, they will promptly submit the updated materials to the Shanghai Stock Exchange and apply to resume review.

Common Data Expiry “Review Suspension” in Q1

Although both companies said the impact is “not significant,” the market has been discussing the possibility of “restructuring delays.”

Is it common for mergers and acquisitions to be suspended due to “data validity period” 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, at least 15 companies including Shitou Shares, Yingli Shares, Huamao Technology, Bohai Auto, and ST United have announced suspensions of review due to expired financial or valuation reports.

For example, Bohai Auto planned to acquire four companies owned by Hainachuan. The transaction 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 point out 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, extensions may be granted under special circumstances, but the total extension cannot exceed three months. If data is not updated within this period, the exchange will suspend review.

On one hand, from the company’s perspective, submitted financial data are often based on mid-year or year-end figures from the previous year. After a review cycle of 6-9 months, relevant data often expire at the beginning of the following year.

On the other hand, from the perspective of auditing agencies, the first quarter is also the peak period for annual report audits, with intensive audit work that can cause delays in data updates.

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

How long do these review suspensions typically last before resuming?

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

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

A faster example is Chuangyuan Xinke’s plan to acquire 100% equity of Shanghai Weiyu Tiandao Technology. The transaction was suspended on January 30, 2025, due to expired financial data. Just ten days later, on February 9, the company submitted a review restoration application, and on February 11, the North Exchange approved the resumption.

“Decade-long Marriage” Sparks Attention to “Traffic + License” New Model

Returning to the transaction of Xiangcai Securities’ share swap to merge with Great Wisdom, the market’s discussion is also related to the long timeline of this deal.

In fact, this is not the first attempt at “marriage” between Xiangcai Securities and Great Wisdom. In 2015, Great Wisdom planned to acquire Xiangcai Securities for 8.5 billion yuan, which was officially accepted by the Shanghai Stock Exchange but was soon suspended due to Great Wisdom’s suspected disclosure violations leading to an investigation.

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

Regarding this transaction, 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 major restructuring, this duration is not short, testing market patience and attention.

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

In November 2025, an individual shareholder filed a lawsuit against Great Wisdom over procedural compliance issues in the restructuring. Although the suit was quickly withdrawn and did not affect the process, it sparked market discussions about the transaction’s legality.

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

It’s understandable that, with negative events still unresolved, even routine issues like review suspension can cause investor anxiety.

However, industry insiders remain optimistic about this decade-long “reunion,” believing that the long-term recognition of mutual business complementarity will lead to more cautious and pragmatic integration plans this time.

From the current fundamentals, the “safety cushion” for the restructuring is stronger.

In 2025, Xiangcai Securities’ core entity, Xiangcai Securities, is expected to achieve total operating revenue of about 1.955 billion yuan, up 28.8% year-on-year, with net profit around 553 million yuan, a 157.5% increase.

Great Wisdom is projected to have a net profit attributable to parent of -34 million to -50 million yuan, and net profit after non-recurring gains and losses of -69 million to -85 million yuan. Although it remains unprofitable, the loss has narrowed significantly compared to 2024.

Regarding the outlook after the merger, Pacific Securities’ chief analyst Xia Mian’ang pointed out that combining Xiangcai Securities’ full securities license with Great Wisdom’s over ten million active monthly users could create a new “traffic + license” internet securities model.