When a listed company publishes a capital reduction announcement, if the reason is that there are excess assets or serious losses to change the project, the registered capital will be reduced according to law, the company's responsibility will be weakened, and the shareholders' rights and interests will be reduced, then the negative sentiment will be even greater.
If it is because the company has improved its financial structure, enhanced shareholders' equity per share and attracted new funds, it means that the stock is more valuable, so there may be many benefits.
The announcement of capital reduction, that is, the announcement of capital reduction, is usually an act that the company needs to reduce the total capital of the company according to law for reasons. According to the principle of constant capital, the company's capital cannot be reduced at will, but it is not absolutely constant. Capital reduction can be handled through legal procedures.
Capital reduction process
1. The shareholders' meeting made a resolution to reduce the subscription amount of registered capital.
2. Resolutions or decisions of the shareholders' meeting on capital increase, and amendments to the Articles of Association.
3. Handle relevant pre-approval according to laws and administrative regulations.
4. Prepare the balance sheet and property list according to the reduced registered capital.
5. Notify creditors and make an announcement within 30 days from the date of resolution.
6. Pay off debts or provide guarantees.
7. Apply for industrial and commercial change registration 45 days after the announcement of capital reduction.