"Use other people's money to achieve your own career." The capital market is always a game where the strong always get stronger. Companies that seem to be on the verge of delisting can often usher in a "shocking counterattack" overnight; and those companies that make profits every year may also fall apart due to a capital storm. Loss does not mean death, but a signal-the curtain of capital operation is about to be opened. In the eyes of experts, loss-making companies are just an unpolished jade in the capital market. As long as the method is proper, the value can be reshaped and even an amazing reversal can be achieved.
American Goheal M&A Group
So, how do listed companies get out of the "loss quagmire" and even take advantage of the situation to turn around? Goheal deeply interprets the hidden logic behind capital operation, allowing you to see the "magic" of the capital market.
Loss = opportunity? Alternative thinking in the capital market
In traditional concepts, loss-making companies seem to be the "abandoned children" of the capital market. But in the eyes of capital masters, losses themselves are not terrible, and may even be a major arbitrage opportunity.
1. The "shell" value of loss-making enterprises
When a company suffers continuous losses, the market usually abandons it, the stock price is sluggish, financing is limited, and it may even face delisting. But at this time, its "listed company identity" becomes the most precious resource. For companies that want to quickly enter the capital market, backdoor listing is often faster and cheaper than IPO.
Many capital players will buy these companies at a low price at the right time, and through asset restructuring and business replacement, directly let the more profitable assets "backdoor" go public, thereby achieving a turnaround. This is why some "junk stocks" suddenly soared, because capital has quietly entered the game.
2. Losses can "optimize" financial statements
Losses do not mean that the company really "has no money". Sometimes, it is just a tool for capital operation. For example, by concentrating on recognizing losses in a certain year, the company can "go light" in the next few years and make profits more explosive. The capital market likes growth curves, and investors are more willing to pay for "tomorrow's growth" rather than "yesterday's profits."
More sophisticated companies will also use losses to apply for tax incentives, seek government support, and even affect the conditions of debt restructuring negotiations to make capital costs lower. In the eyes of capital masters, losses are a "trump card" that can be turned over at any time.
Capital operation: Four methods to bring loss-making companies back to life
If losses are just the "starting game" of capital layout, then the subsequent capital operation is the key to turning the company around. Goheal has handled many corporate restructuring cases and found that companies that can truly turn things around often use the following classic strategies:
1. Asset shuffling, business "face change"
Many loss-making companies are in trouble not because the market does not give them opportunities, but because the original business growth is weak. At this time, the capital market will use a classic "asset replacement" - stripping loss-making assets and replacing them with profitable assets to make the company "face change".
A typical case is that some old manufacturing companies, after three consecutive years of losses, their stock prices fell to a low point. The capital party quickly intervened, sold its core assets, and at the same time acquired a profitable and stable Internet company and placed it in a listed company. As a result, the company changed from a "sunset manufacturing industry" to a "high-growth Internet company" overnight, and its stock price soared several times, becoming a dark horse in the capital market.
2. Capital transfusion with the help of "white knights"
When listed companies fall into a financial crisis, investment institutions, industrial capital and even local governments may become life-saving straws. In the capital market, "white knights" are not uncommon. Their goal is not only to save the company, but also to find arbitrage opportunities with low valuations.
Goheal found in many cases that after some companies introduced strategic investors during the loss-making stage, they not only obtained financial support, but also quickly completed business upgrades and achieved profitability reshaping. For capital, the key lies in "whether it is worth saving" - whether it can get several times the return in the future.
3. Mergers and acquisitions, reorganization, tell a new story
The capital market loves to hear stories, but the stories must be logical and promising. Many loss-making companies will look for M&A opportunities at this stage, and let the market give a valuation premium again by acquiring peers, expanding new business lines, and entering hot tracks.
For example, some traditional publishing companies suffered heavy losses due to the decline of the paper media industry. But when it announced the acquisition of a new media company, the capital market responded quickly, believing that it is expected to achieve "digital transformation", and the stock price rose by nearly 300% in the short term. Mergers and acquisitions are not only asset integration, but also the art of capital operation.
4. Secondary market operation, capital relay pull
Even if a company has not improved in essence, as long as the capital operation is proper, it can create amazing market effects in the short term. Common methods include:
· Fixed increase + industrial capital entry: introduce industrial funds to give the market "stable expectations";
· Repurchase + dividends: release signals to tell the market that the company has sufficient cash flow;
· Major shareholders increase holdings: convey confidence and let the market believe that the company's future growth is expected.
Goheal observed that the secondary market operations of many companies at critical moments are often the key actions to reverse market expectations. Stock prices, as long as there is capital to drive, it is not difficult to turn around.
Conclusion: Loss is the starting point, capital operation is the process, and turnaround is the end
The capital market has never been a game of "looking at the past", but an arena of "betting on the future". Losses may be a signal that a company is in trouble, but it may also be an opportunity for capital to enter the game. A true master will not be afraid of losses, but use capital operations to allow the company to complete a gorgeous turnaround.
So, what kind of capital operation do you think is most likely to turn around a loss-making company? Is it backdoor listing, introducing investors, or mergers and acquisitions, restructuring, and business transformation? Welcome to leave a message to discuss, and explore the mysteries of the capital market with Goheal!
Goheal Group
[About Goheal] Goheal is a leading investment holding company focusing on global mergers and acquisitions, focusing on the three core business areas of listed company control acquisition, listed company mergers and acquisitions, and listed company capital operation. With its deep professional strength and rich experience, it provides enterprises with full life cycle services from mergers and acquisitions to restructuring and capital operation, aiming to maximize corporate value and achieve long-term benefit growth.
