The annual report season has just concluded. Following the release of its financial results showing revenue and profit growth, China International Capital Corporation Limited (CICC) has disclosed the latest progress of its significant "three-in-one" merger plan.

On May 18, CICC released the draft proposal for its share swap to absorb and merge Dongxing Securities and Cinda Securities. The draft indicates that the swap price for CICC's A-shares is set at RMB 36.68 per share. The swap prices for Dongxing Securities and Cinda Securities are RMB 16.05 per share and RMB 19.11 per share, respectively. The share swap ratios are set at 1:0.4376 for Dongxing Securities to CICC and 1:0.5210 for Cinda Securities to CICC.

According to the draft, CICC plans to issue approximately 3.104 billion A-shares for this transaction. Following the share swap, Central Huijin Investment Ltd. will remain the controlling shareholder and actual controller of CICC.

Since 2026, mergers and acquisitions (M&A) in the securities industry have continued to gain momentum, with announcements of combinations like "Soochow Securities + Donghai Securities" and "Oriental Securities + Shanghai Securities." The formation of the "new CICC" is also accelerating. Based on the latest annual report data, the merged CICC entity is projected to achieve annual revenue exceeding RMB 37 billion, with parent company net capital surpassing RMB 100 billion, leading to significant jumps in its industry rankings across various metrics.

In its 2025 annual report, CICC stated it would actively seize opportunities for external expansion. While maintaining high-quality organic growth, the company is actively promoting the absorption and merger of Dongxing Securities and Cinda Securities. The goal is to fully leverage the complementary strengths in financial capital, network distribution, business capabilities, and client resources, striving to achieve a "1+2>3" synergistic effect.

M&A activities are progressing rapidly. As an industry leader, CICC's merger moves are closely watched by the market.

Since 2025, a wave of securities firm mergers has surged powerfully. Combinations like Guolian Minsheng and Guotai Haitong have emerged in the capital markets, while approvals were granted for "Western Securities + Guorong Securities" and "Guosen Securities + Wanhe Securities." The merger news announced by CICC towards the end of last year further elevated the industry's consolidation fervor.

At that time, CICC reached the significant milestone of its 30th anniversary. Following its acquisition of China Investment Securities in 2017, the "thirty-something" CICC continued its external expansion.

In terms of shareholder background, CICC, Dongxing Securities, and Cinda Securities are all brokerages under the "Huijin system." As of the end of last year, Central Huijin held 1.936 billion shares of CICC, representing a 40.11% stake, making it the controlling shareholder. Central Huijin indirectly holds shares in Dongxing Securities and Cinda Securities through China Orient Asset Management and China Cinda Asset Management, with ownership stakes of 45.00% and 78.67%, respectively.

Within the securities industry, CICC's merger differs from the typical "1+1" strong alliance between peers, adopting instead a "1+2" model to absorb two A-share listed brokerages at once. When the merger news was initially disclosed, CICC noted that the restructuring involved a dual-listed A+H share company simultaneously absorbing two A-share listed companies, involving numerous matters and relatively complex procedures.

However, since CICC officially announced the merger, related work has steadily progressed, and the transaction draft has been reviewed and approved by the respective boards of directors.

Regarding this transaction, CICC stated in the latest draft that the company will comprehensively integrate resources from all three parties to further enhance overall strength, achieve complementary advantages, and optimize business layout. This aims to effectively improve the company's core competitiveness in areas such as capital strength, client base, and comprehensive services, aligning with the high-quality development requirements of the financial industry. The goal is to build a first-class investment bank with international competitiveness and contribute to building a strong financial nation.

The market is particularly concerned about the scale of the "new CICC" and how business synergies will be realized post-merger.

According to the 2025 annual report, CICC achieved annual operating revenue of RMB 28.481 billion and net profit attributable to the parent company of RMB 9.791 billion, representing year-on-year growth of 33.50% and 71.93%, respectively. During the same period, Dongxing Securities and Cinda Securities reported revenues of RMB 4.711 billion and RMB 4.044 billion, with net profits attributable to the parent company of RMB 2.102 billion and RMB 1.894 billion, respectively, also showing increases in both revenue and profit.

Based on the pro forma consolidated financial data disclosed in the draft, the total revenue for "CICC + Dongxing + Cinda" in 2025 would reach RMB 37.173 billion, with cumulative net profit attributable to the parent company amounting to RMB 13.786 billion.

Comparing with the 2025 annual report data, the revenue scale of this "new CICC" would surpass that of Huatai Securities, rising to the third position in the industry, behind only CITIC Securities and Guotai Haitong. Its net profit attributable to the parent company would essentially match that of GF Securities, ranking fourth in the industry and entering the "billion-dollar net profit club."

As of the end of 2025, the net capital of CICC, Dongxing Securities, and Cinda Securities was RMB 48.143 billion, RMB 28.656 billion, and RMB 24.926 billion, respectively. Post-merger, the total net capital of the "new CICC" would exceed RMB 100 billion.

Not only will financial metrics continue to improve, but the businesses of the three companies are also highly complementary. CICC's main businesses are well-balanced, with a distinct advantage in investment banking. In contrast, Dongxing Securities and Cinda Securities, both being AMC-affiliated brokerages, excel in retail brokerage and proprietary trading. Notably, Cinda Securities has a prominent advantage in special asset investment banking areas such as bankruptcy restructuring.

It is understood that CICC will fully utilize its professional services, product capabilities, and international brand advantages to achieve synergies with the strong businesses and client resources of Dongxing Securities and Cinda Securities. This will continuously optimize the business layout and comprehensively enhance the capability to serve national strategies.

In terms of regional expansion and client base, post-merger, CICC's network distribution will be further optimized and enhanced. Based on data from the end of 2025, the number of CICC's business outlets will increase from 247 to 441 post-merger, raising its industry ranking from 14th to 3rd. The number of retail clients will grow from 9.99 million to over 15 million, the number of investment advisors will exceed 5,700, and the scale of products under custody will increase from over RMB 460 billion to over RMB 500 billion.