A shell company in the Chinese context typically refers to a publicly listed target company that is acquired so that the acquirer can circumvent the process of going public. Specifically, a private acquirer that wants to go public can avoid going through the uncertainties and complexities of the IPO process by simply acquiring a company that is already publicly listed in order to attain publicly listed status.

For example, Hengda (China Evergrande) Group launched its healthcare business by acquiring a publicly listed media company on the Hong Kong Stock Exchange, renamed it Evergrande Health Industry Group, and commenced healthcare business operations. This allowed Hengda to have a publicly listed healthcare subsidiary without actually going through the IPO process.