HHCK(SH:688535) Zheng Quan Shi Bao·2025-10-21 10:32Core Viewpoint - The adoption of targeted convertible bonds as a payment method for mergers and acquisitions (M&A) is gaining popularity among listed companies due to their "dual attributes" of equity and debt, providing flexibility and reducing financial pressure [1][4]. Group 1: Adoption of Targeted Convertible Bonds - Since the introduction of targeted convertible bonds for M&A, 16 A-share listed companies have announced plans to use this payment method alongside equity and cash [1][3]. - The "M&A Six Guidelines" encourage companies to utilize a combination of equity, targeted convertible bonds, and cash to enhance transaction flexibility [1][3]. - Companies in the technology sector, particularly those listed on the Sci-Tech Innovation Board and the Growth Enterprise Market, show a preference for using targeted convertible bonds in their M&A activities [1][5]. Group 2: Benefits of Targeted Convertible Bonds - Targeted convertible bonds offer a dual design of "debt protection + equity flexibility," meeting the needs for principal security while allowing for shared growth benefits through conversion options [1][6]. - Compared to traditional cash payments, targeted convertible bonds reduce financial pressure and delay the dilution of existing shareholders' control [4][6]. - The low-interest nature of targeted convertible bonds makes them a cost-effective financing option, alleviating cash flow concerns for companies [4][6]. Group 3: Focus on Technology Companies - Over 60% of the companies planning to use targeted convertible bonds for asset purchases are from the Sci-Tech Innovation Board and the Growth Enterprise Market, primarily targeting technology firms [5][6]. - The technology sector's characteristics, such as being asset-light and having high R&D investments, make traditional valuation methods less effective, thus benefiting from the flexible pricing allowed by targeted convertible bonds [6][7]. - The acquisition activities in sectors like semiconductors and new materials reflect a growing interest in technology stocks and the urgent need for resource integration in industrial upgrades [6][7]. Group 4: Efficiency in M&A Transactions - The use of innovative tools like targeted convertible bonds, M&A loans, and funds has significantly improved the efficiency of M&A transactions, reducing costs and risks [7]. - Targeted convertible bonds enhance market activity and facilitate resource integration, providing stable funding support for transactions [7]. - They help balance the risk-reward dynamics between transaction parties, addressing issues related to high valuations and performance commitments [7].