After several twists and turns, Rui Xing finally withdrew from the market. On June 29th, Ruixing stopped trading at the opening of Nasdaq, and its share price remained at the closing price of $65,438 +0.38 on the 26th, with a market value of only $347 million. Ruixun, which has been suspended, entered the OTC market, and its code changed from LK to LKNCY.
Ruixing withdrew from the market and it was over? It's not that simple. At least three "chases" are waiting for Ruixing and its traders. Come out to mix, sooner or later; The cut leek will grow out sooner or later. Those foreign leeks harvested by Ruixing have launched the first "pursuit"-class action lawsuit.
Although investors of Ruixun can still get some comfort in the OTC market, it is far from making up for their losses. Over-the-counter market is the follow-up channel of the delisting mechanism of US stocks, leaving the last chance for those companies that have withdrawn from the market due to poor financial conditions. If properly managed, it is still possible to return to the main board market. For investors, this is a comfort. After Ruixun's delisting, it can also be traded over the counter. Only the liquidity of OTC is very poor, and it is difficult for investors to recover losses in OTC. In the over-the-counter market, Ruixun plunged 30% at the opening, offering $0.965, but the price of Ruixun was quickly raised to $65,438+$0.29.
On June 4th and 5th before delisting, Ruixing's share price also rose from 2.58 yuan to 6.2 yuan, and the price doubled and the transaction was enlarged several times. At this time, who dares to absorb Ruixing's stock? It should be Rui Xing himself. Because the class action lawsuit of Ruixun investors against Ruixun has begun, raising the stock price can make some investors take the initiative to sell their shares and claim for compensation themselves, so Ruixun needs to pay less in the class action lawsuit.
But for the tens of billions of losses of investors, this will not play any role. Ruixing's share price reached $565,438 +0.38 in June this year, and now it has fallen to around $65,438 +0. The difference of $50, multiplied by the total share capital of 252 million, may theoretically be as high as10 billion. But the actual calculation will be very complicated, because only a few stocks are traded at the highest point, and most investors may buy at a low price.
According to Bloomberg News, Ruixun's class action lawsuit in the United States has appointed the chief plaintiff and law firm, among which the Swedish pension fund Sjunde AP-Fonden and the Louisiana Police Pension and Relief Fund are the chief plaintiffs. Bloomberg reported that the two funds lost $6.9 million on Ruixing's investment.
As early as February this year, after the well-known short-selling company "Muddy Water" published a report on Ruixun's fraud, the law firm Bragar Eagle & Squirep.C issued a notice saying that the representative was in 201911310 to 20201.
However, how much solvency can Ruixing have at present? Ruixing's store is rented, and the coffee machine is the working capital in exchange for financial leasing. In the third quarter of 2065438+2009, the total current assets were $6.355 billion. I don't know how much water there is ... so it's hard to say how much losses investors can recover. The biggest possibility is reconciliation.
Despite this, compared with the punishment in the A-share market, it is still very severe. Imagine that in the case of Kangmei Pharmaceutical's 29.9 billion huge performance fraud, the parties were only fined 600,000 yuan. In the "Oolong Finger of China Everbright Bank" incident, investors only got compensation of 660,000 yuan, ranging from 3480 yuan to 65438 yuan +034640 yuan * * ... The "tickling" punishment of fraud in the A-share market will not only be effective, but also make those counterfeiters very comfortable!
The second "hunting" was punished by the US regulatory authorities.
From Nasdaq's "unconventional means" of delisting by notice, we can see that the US side is disgusted with companies like Ruixing. As we all know, American regulators are very strict about stock market fraud. After the Enron incident, Jeffrey skilling, CEO of Enron, was sentenced to 24 years' imprisonment and fined $45 million. Kenneth Lai, the founder of the company, was dismissed from criminal charges for his death during the lawsuit, but was still fined120,000 USD. Andersen, an accounting firm that helped forge, was fined $500,000 and banned from doing business for five years. As a result, the world's top five accounting firms have become the "Big Four". As for the relevant investment banks, Citigroup, Bank of JPMorgan Chase and Bank of America were convicted of financial fraud, and paid 2 billion, 2.2 billion and 69 million dollars in compensation fines to the bankruptcy victims of Enron respectively.
Ruixun's listing and delisting speed is fast, and the scale and influence of fraud are not comparable to Enron. However, with the punishment of the United States, Ruixun executives are afraid to go abroad casually.
Wouldn't it be nice not to go abroad and hide in China as a hermit? Not necessarily. China still has a "curiosity" waiting.
When Ruixing went public, the new securities law, which had been brewing for a long time in China, was put to the vote, passed on February 20 19, and came into effect on March 2020 1 day. According to the Luckin Coffee incident, the China Securities Regulatory Commission exercised "long arm jurisdiction" for the first time, and Luckin Coffee may become the "first case" of long arm jurisdiction after the implementation of the new Securities Law.
On the other hand, the bad international influence of Ruixun's fraud incident angered our leaders and ordered investigations several times in a row. Therefore, even if there is no "long arm jurisdiction", the participants of Ruixun fraud will not get good fruit in China, and some of them are likely to go to prison to live a public life.
Now, Rui Xing is in chaos again. Tomorrow (July 2nd), Ruixing will hold a board meeting to consider the resignation proposal of Chairman Lu. The company will hold a special shareholders' meeting on July 5th to discuss whether to remove Shao's independent director and directors, Lu and Wang.
What are they arguing about at this time?
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Edit | Huang Yanli