On July 23, the IPO of Guangzhou Zhongwang Longteng Software Co., Ltd. (hereinafter referred to as Zhongwang software) was interrupted.
According to the information disclosed by the Shanghai Stock Exchange, on July 23, the IPO project process of Zhongwang software was updated to suspension (other matters). The reasons for project suspension are as follows:
On July 23, 2020, Guangzhou Zhongwang Longteng Software Co., Ltd. was issued by the China Securities Regulatory Commission (CSRC) as the sponsor and securities service agency of the issuer. The regulatory measures, such as restricting business activities, ordering to suspend business for rectification, appointing other institutions to custody or take over, have not been lifted. In accordance with Article 64 (3) of the examination and approval rules, the exchange shall suspend the examination and approval of its issuance and listing.
It is understood that the sponsor of China hope software is GF Securities. On July 10, GF Securities was severely punished for the fraud case of Kangmei pharmaceutical, and was suspended by Guangdong securities regulatory bureau for 6 months as a sponsor and 12 months as a relevant document for bond underwriting business. Therefore, Zhongwang software, as one of the companies sponsored by it, has been affected.
It should be noted that suspension is different from termination. The company that has suspended the audit still has the opportunity to regain the audit opportunity within three months. According to the Shanghai Stock Exchanges rules on the examination and approval of stock issuance and listing on the science and Technology Innovation Board of Shanghai Stock Exchange, Zhongwang software can replace its sponsor or securities service agency within three months. That is to say, after Zhongwang software replaced GF Securities with other sponsors, it still has the opportunity to continue the IPO process.
The specific rules are as follows:
If the issuer needs to replace the sponsor or securities service agency according to the provisions, the replaced sponsor or securities service institution shall complete due diligence within three months from the date of suspension of examination, issue relevant documents again, review the documents issued by the original sponsor or securities service agency, issue review opinions and explain the differences.
Zhongwang software was accepted by the IPO of the science and technology innovation board on April 9 this year. It is an enterprise engaged in the R & D and sales of industrial software (mainly 2D and 3D CAD, cam, CAE software).
In June, interface News reported that Zhongwang software was suspected of incomplete information disclosure in the prospectus, and the autonomy of its core products was controversial. The next day, Zhongwang software publicly replied to the query raised by the interface news.
Shortly after the release of the article, in the second round of inquiry sent to China hope software on June 19, the Shanghai Stock Exchange also mentioned issues such as its own kernel. In its reply letter, Zhongwang software more specifically answered the questions raised by the interface news:
First, Zhongwang software claims that its core product ZWCAD has completely independent property rights. In fact, part of its product technology comes from the third-party organizations: ITC and ODA of the United States. Second, the United States may cut off its supply to China, posing risks to its products.
In response, Zhongwang software replied: ZWCAD does use some third-party technologies, but it has a low degree of technical dependence on ITC and ODA. If the supply is cut off, ITC may affect some functions of ZWCAD products, and it will take about half a year to complete the self-study; if ODA is out of supply, it will take three to four years to complete the self-study.