Gregory Puff and Michelle Chan Discuss China’s Growth of Go-Private Transactions

Gregory Puff and Michelle Chan, partner and associate, respectively, in Akin Gump’s Hong Kong office, have written an article for Hong Kong Lawyer on the latest take-private trends in China.

“Going Private - A Review of the PRC Deal Landscape and What Lies Ahead in 2014” looks at why so many U.S.-listed companies have announced their intention in the past three years to go private. The authors note that the trend is due, in part, to “the heavy regulation and high compliance costs of being a public company in the US, and unfavorable valuations due to trading discounts.”

The article also discusses why more going-private transactions may be in the offing. Puff and Chan write there remains a “determination of founders/controlling shareholders to leave the US exchanges in the hopes of a future relisting on a more favorable exchange such as Hong Kong or Shanghai.” This, they add, will lead to “an appetite for China-related going-private transactions in the months ahead.”