Good News: Shenzhen Issues Major Policy to Boost Corporate M&A and Restructuring

Shenzhen M&A Action Plan — a major policy roadmap aimed at accelerating corporate M&A and restructuring in Shenzhen.

Key Points

Quick snapshot — what this change means

Shenzhen M&A Action Plan is a city‑level, targeted push to steer capital, talent and market infrastructure toward faster industrial consolidation in strategic emerging industries.

The plan covers the period 2025–2027 and sets measurable targets, financing pathways and talent incentives to speed up mergers, acquisitions and strategic restructuring.

What was announced

On October 22, Shenzhen Municipal Local Financial Supervision and Administration Bureau (Shēnzhèn shì dìfāng jīnróng jiāndū guǎnlǐ jú 深圳市地方金融监督管理局) together with multiple municipal departments released the “Action Plan for Promoting High‑Quality Development of Mergers & Acquisitions and Restructuring (2025–2027)” (the “Action Plan”).

The plan sets concrete targets, sector priorities and financing/talent support measures aimed at accelerating M&A‑led industrial consolidation in strategic emerging industries.

Key targets through 2027 (clear, measurable goals)

The Action Plan establishes a focused set of outcomes to be reached by the end of 2027.

• Improve overall quality of listed companies in Shenzhen (Shēnzhèn 深圳).

• Raise combined market capitalization of domestic and overseas listed companies in the jurisdiction to more than ¥20 trillion RMB ($2.8 trillion USD).

• Grow the “thousand‑hundred‑billion” club to 20 firms — i.e., cultivate 20 companies with market value near ¥100 billion RMB ($14 billion USD) each.

• Drive more and bigger deals: complete over 200 M&A transactions totaling more than ¥100 billion RMB ($14 billion USD) in aggregate.

• Build a trillion‑level fund matrix — a “20+8” industrial fund cluster to mobilize social capital for coordinated industry chain M&A.

Sector focus: boosting new‑quality productive forces

The plan prioritizes M&A that strengthens strategic emerging industries and creates the “new‑quality productive forces” Beijing and Shenzhen officials often reference.

Priority sectors named include:

• Integrated circuits (Jíchéng diànlù 集成电路)

• Artificial intelligence (Réngōng zhìnéng 人工智能)

• New energy (Xīn néngyuán 新能源)

• Biomedicine (Shēngwù yīyào 生物医药)

Shenzhen will support “chain‑lead” companies and leading listed firms to pursue upstream and downstream acquisitions, especially when targets:

• Strengthen supply chains.

• Fill key capability gaps.

• Accelerate technological upgrades.

The plan also encourages M&A in forward‑looking tracks such as synthetic biology (合成生物), smart robotics (智能机器人), quantum information (量子信息), and frontier new materials (新材料) to scale industry and fast‑track breakthroughs.

State‑owned assets and valuation tolerance

The Action Plan speeds up strategic restructuring and professional consolidation of state‑owned enterprises.

Local state‑owned controlling listed companies will be encouraged to adopt a more inclusive valuation approach for light‑asset, tech‑oriented M&A targets and to make forward‑looking investments through state capital arrangements.

Project pipeline and selection mechanism

Shenzhen will build a municipal M&A target project library to cover priority industries.

A “city‑district linkage + department coordination + market recommendation” mechanism will identify, solicit and select projects for the repository.

Projects that already meet policy requirements will be actively advanced.

Projects not yet fully eligible—but aligned with “hard tech” or “Three Innovations & Four New” (Sān chuàng sì xīn 三创四新) domains—will be placed into a reserve pool for cultivation.

The plan envisions a rolling pipeline: reserve → intention → ready, to produce a steady stream of high‑quality M&A targets.

Financing and risk‑transfer measures

The Action Plan expands practical deal structures and risk mitigants to make M&A more financeable.

Eligible acquirers are encouraged to use mixed consideration structures including:

• Cash.

• Shares.

• Directed convertible bonds.

• Sci‑Tech bonds (kēchuàng zhàiquàn 科创债券).

The plan supports staged payment for restructuring shares and shelf‑based fundraising to fund deals.

Financial institutions are asked to provide credit support through acquisition loans, syndicated loans and combined equity‑debt financing.

Pilot innovations such as non‑resident acquisition loans and merger loans for technology firms will be explored.

Financing guarantee and re‑guarantee institutions will offer credit enhancement for transactions and post‑deal operations.

Insurance institutions are encouraged to provide comprehensive protection — via co‑insurance, large commercial insurance and wrap policies — to cover operational and integration risks for M&A targets.

Where companies raise funds via M&A loans or bond financing, district authorities with capacity may provide interest subsidies tailored to local conditions.

Strengthening securities industry capabilities

The plan calls for cultivating specialized M&A advisory teams within financial institutions and building a cohort of leading professional service providers.

Securities companies (Zhèngquàn gōngsī 证券公司) are explicitly supported to grow competitiveness through strategic acquisitions and to accelerate construction of first‑class investment banking capabilities.

Global investment banks and institutions with M&A focus are encouraged to locate headquarters or branches in Shenzhen.

Talent, incubation and investor participation

Shenzhen will include an M&A talent rolling training plan in its “Hundreds‑Thousands‑Tens of Thousands” financial talent program to attract cross‑disciplinary senior talent with “industry + finance” backgrounds.

The plan supports eligible high‑caliber professionals and teams in obtaining household registration and provides policy support for housing, education and medical services.

Private capital participation is explicitly invited — including:

• Corporate venture capital (CVC) targeting strategic chain nodes.

• Private equity funds via direct investment and M&A funds.

• Asset securitization and pilot programs allowing private equity fund shares to be transferred.

• Second‑market PE (S‑fund) to provide complementary financing for M&A.

The plan aims to enable a virtuous “exit → reinvest” cycle for equity venture funds and to prudently welcome patient capital and qualified offshore investors through QFII, QFLP and other compliant channels.

Cross‑border and regional cooperation

To improve cross‑region deal efficiency, eligible leading enterprises will be supported in listing or refinancing in Hong Kong.

Cross‑border tools such as asset transfers, two‑way cross‑border equity investment and cross‑border syndicated loans will be encouraged for orderly inbound and outbound M&A.

The plan promotes joint Shenzhen–Hong Kong cooperation in establishing equity funds for industrial M&A.

Shenzhen Stock Exchange (Shēnzhèn Zhèngquàn Jiāoyì Suǒ 深圳证券交易所) and Hong Kong Exchanges and Clearing Ltd. (HKEX) are urged to deepen cooperation and explore interconnected mechanisms for M&A and equity‑debt financing.

Local securities firms are encouraged to partner with overseas branches to provide cross‑border financing, advisory, and professional M&A services.

Support for tech transfer and market infrastructure

The plan backs the Shenzhen Stock Exchange in building an end‑to‑end service system for listed company M&A projects.

It supports the Shenzhen Intellectual Property and Technology Transfer platforms in deepening services for technology commercialization, tiered incubation, mentoring, roadshows and financing matchmaking.

Technology transfer will be combined with equity incentives, technology M&A and financing channels to improve tradability and conversion efficiency of tech outcomes.

The Qianhai (Qiánhǎi 前海) equity trading center will be further developed to support a high‑quality “Specialized, Refined, Distinctive, and Innovative” (Zhuānjīng tènxīn 专精特新) board and help small‑and‑medium tech firms integrate resources through multiple paths.

Why this matters — quick takeaways for investors and founders

Since the national “Six M&A Measures” issued in September last year, market activity in M&A and restructuring has risen noticeably.

Shenzhen’s Action Plan seeks to sustain that momentum by aligning policy, finance, talent and market infrastructure to guide capital and resources toward technology‑driven industrial upgrading.

Practical implications for companies and investors

• Strategic acquirers — especially in the specified emerging sectors — may find expanded financing channels and local subsidies/support when deals align with Shenzhen’s priorities.

• State‑owned and state‑controlled entities will be encouraged to play an active role in strategic consolidation and to tolerate higher valuations for light‑asset tech targets where strategic value is clear.

• Securities firms and advisors with M&A capabilities can expect stronger local demand and municipal support for building teams and operations in Shenzhen.

• Cross‑border transactions may become more efficient when they connect with Shenzhen–Hong Kong cooperation and newly piloted financing tools.

How to prepare if you’re an investor, founder or advisor

If you’re actively working in M&A, consider these practical next steps to align with Shenzhen’s priorities.

• Map strategic fit: prioritize targets that strengthen supply‑chain resilience, tech capabilities or forward‑looking tracks like AI and synthetic biology.

• Design flexible deal structures: include combo consideration (cash, shares, convertible bonds, Sci‑Tech bonds) and staged payments to fit policy‑backed mechanisms.

• Engage local partners: work with Shenzhen securities firms, M&A advisors and insurance providers who will be scaling capabilities under the plan.

• Plan cross‑border execution: structure listing or refinancing paths with Hong Kong when valid, and use compliant channels like QFII/QFLP for offshore participation.

• Invest in talent: cultivate “industry + finance” profiles that the municipal program explicitly seeks and leverages for deal execution.

Where to watch next

Key things to monitor as the Action Plan rolls out:

• Details of the municipal M&A target project library and which projects move from reserve → intention → ready.

• Launch of the “20+8” industrial fund matrix and the composition of trillion‑level funds.

• Pilots for non‑resident acquisition loans, merger loans for tech firms and insurance wrap products for M&A integration risk.

• Cooperation mechanisms between Shenzhen Stock Exchange and HKEX to support cross‑border M&A financing and payment flexibility.

Final note

This Action Plan creates a clearer runway for M&A that targets technological scale‑ups and supply‑chain strengthening, and places Shenzhen at the center of industrial consolidation in emerging tech sectors.

Shenzhen M&A Action Plan is now a concrete policy lever investors, founders and advisers should factor into deal sourcing and capital allocation decisions.

References

• Good news: Shenzhen releases major policy to support corporate M&A and restructuring! – Eastmoney
• Shenzhen Municipal People’s Government – Shenzhen Government