"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 to merge Xiangcai Securities into Great Wisdom through share swap and raise supporting funds has been suspended because the valuation data in the filing documents expired on March 14. The Shanghai Stock Exchange has suspended review of this transaction in accordance with regulations.

Both companies stated that the suspension of review will not have a significant adverse effect 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 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 or 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 resumption 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 merger with Great Wisdom in 2025, this decade-long “reunion” has attracted market attention.

Looking ahead, industry insiders generally hold a positive outlook on the post-merger prospects, expecting the reorganization to create a new “traffic + license” model for internet securities firms amid the ongoing wave of securities industry mergers and acquisitions.

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 in their submitted application documents had expired and needed updating. Under the “Rules for Major Asset Restructuring of Listed Companies,” the exchange suspended review of this transaction.

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

Additionally, the restructuring report cites 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 review suspension, both sides stated that it would not significantly affect the transaction and that their operations are normal.

They also said that 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 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, 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—on January 31 and February 28—due to expired audited financial data and evaluation reports.

Industry insiders point out that, according to regulations on major asset restructuring, 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 no more than 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, relevant data often expire in early the following year.

From the auditor’s perspective, 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 suspensions usually last before review resumes?

Past cases show that companies typically resume review after 1-2 months of data updates and supplementation. Some companies, acting faster, have applied for review resumption within just a few 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 extending the audit and updating documents, 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 resumption application to the Beijing Stock Exchange, and on February 11, the exchange approved resumption.

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

Returning to the merger of Xiangcai Securities and 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 a “marriage” between the two companies. In 2015, Great Wisdom planned to acquire Xiangcai Securities for 8.5 billion yuan, and the deal was officially accepted by the Shanghai Stock Exchange. However, it was soon suspended after Great Wisdom was investigated for disclosure violations.

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.

The current process—from the initial disclosure of the merger plan on March 28, 2025, to the suspension of review on March 14, 2026, due to expired documents—has taken nearly a year. For such a high-profile major restructuring, this duration is not short, testing market patience and attention.

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

In November 2025, an individual shareholder sued Great Wisdom over procedural compliance issues related to the restructuring. Although the suit was quickly withdrawn and did not affect the process, it sparked market discussions about the deal’s legality.

Furthermore, Xiangcai Securities is involved in a case related to the 30 billion yuan “Chengxing Group” 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 under 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 about prolonged delays.

However, industry insiders remain generally optimistic about this decade-long “marriage,” believing that the long timeline reflects mutual recognition of long-term business complementarity. After previous setbacks, both sides are likely to adopt more cautious and pragmatic integration plans this time, which can enhance transaction stability.

From their current fundamentals, the “safety net” for this merger appears stronger.

In 2025, Xiangcai Securities’ core entity, Xiangcai Securities, is expected to achieve total 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 expects a net loss attributable to shareholders of -34 million to -50 million yuan in 2025, with net profit after deducting non-recurring items 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 license with Great Wisdom’s over ten million monthly active users could create a new “traffic + license” internet securities model.