Economic Observer Asks: Is SOE Reform Just Hype?

The main takeaway: investors are simply chasing stocks because they think there will be big merger and takeover premiums for some SOEs, but there's no evidence that SOE reform will be particularly profitable for SOEs in the short-term because the goal of reducing competition (shuttering steel mills, for example) doesn't fully solve the problem and may even hinder economic reforms by creating powerful monopolies:
But the market for the central enterprise integration tide still about to carry out a large area of ​​concern. Insiders believe that the competent authorities to avoid competition through mergers, but can not really eliminate competition. "After a competitive industry of central enterprises merge their competition still exists, but from the outside it, to solve the overcapacity does not help." Even has a central rate of powerful monopolies, with the merger tide formed super monopoly, or will hinder China's Market-oriented reform process.
Is there any profit for shareholders?
This tide before the merger and reorganization of the executive-led, investors do not seem to care about the company's prospects, only focus on the pursuit of the merger premium. SOE reform became the concept of speculation in the capital market. Efficiency of the company after the merger could enhance the international competitiveness of whether there will be increased if the consolidated corporate governance will be more transparent, and will improve the company whether the system? This series is the most worthy of concern was forgotten. Still can not answer the above question, why such a reform would be favored by the capital markets? SOE reform can be simply reduced to market speculation?

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