Looser rules on private share sales in China have prompted a flood of issuance, as cash-strapped companies try to fortify their balance sheets against hits from the coronavirus outbreak.
More than 100 listed companies have raised Rmb209bn ($30bn) through private placements since February 14, when domestic regulators relaxed restrictions, according to data provider Wind. That is an increase of more than 800 per cent on the same period in 2019.
But some have warned that Beijing’s decision to allow greater leeway for private placements, which involve the sale of often discounted shares directly to select groups of investors, could encourage market manipulation.
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