More than 1 billion illegal guarantees from St Jitang

category:Finance
 More than 1 billion illegal guarantees from St Jitang


Two illegal guarantees by controlling shareholders

For the investors of * ST Jitang, the companys thunder is endless.

After being investigated by the CSRC, disclosed that the controlling shareholders and their related parties occupied more than 1 billion yuan of funds, and the annual report was issued with non-standard opinions, on the evening of the 9th, * ST Jitang announced again that according to the information provided by the companys controlling shareholders and relevant operators, the company had violated the external guarantee without performing the relevant internal approval decision-making procedures.

Tongjitang, the controlling shareholder of the company, was the initiator of the two illegal guarantees.

*Stjitang, Tongjitang holding and shenwanhongyuan signed the balance replenishment agreement and share acquisition agreement. According to the balance replenishment agreement, if Shenwan Hongyuan does not fully receive all the income that should be distributed, Tongjitang holdings and * ST Jitang will make up the difference. According to the share purchase agreement, Tongjitang holdings undertakes the purchase obligation of 1 billion yuan of fund units held by Shenwan Hongyuan. If Tongjitang holdings fails to fulfill the acquisition obligations, * ST Jitang undertakes the acquisition obligation of Shenwan Hongyuans shares in the fund. At present, the actual guarantee amount is 1 billion yuan. In April 2020, Shen wanhongyuan filed a lawsuit against Tongjitang holdings and the company for failing to obtain the fixed income of the fund on schedule.

The failure of internal control has been exposed for a long time

According to the companys annual report of 2019, during the report period of 2019, the companys controlling shareholders and their related parties Tongjitang technology, ocean international travel, through suppliers and other non related parties, occupied a total of 1.047 billion yuan of funds, accounting for 16.27% of the companys latest audited net assets.

The internal control audit report also pointed out that the company had abnormal capital flow. In 2019, the company failed to perform the prescribed approval procedures and paid large amount of funds. Among them, through accounts payable, other receivables, other accounts payable and other subjects, a large number of capital transactions with many units. As of the end of 2019, the balance of such prepayments, accounts payable, other receivables and other receivables were RMB 95.1677 million, RMB 247.868 million, RMB 258.551 million and RMB 108.9107 million respectively, so the nature of the above funds and the nature of the transaction could not be confirmed. After the disclosure of the annual report, the company received the regulatory inquiry letter from the exchange and asked for a reply before July 11. But after several delays, the company has not responded. On August 10, * ST Jitang opened with a limit of 1.93 yuan. On the afternoon of the 10th, daily economic news reporters repeatedly called the Secretary Office of * ST Jitang, but they were unable to get through. Source of this article: Yang Bin, editor in charge of daily economic news_ NF4368

The internal control audit report also pointed out that the company had abnormal capital flow. In 2019, the company failed to perform the prescribed approval procedures and paid large amount of funds. Among them, through accounts payable, other receivables, other accounts payable and other subjects, a large number of capital transactions with many units. As of the end of 2019, the balance of such prepayments, accounts payable, other receivables and other receivables were RMB 95.1677 million, RMB 247.868 million, RMB 258.551 million and RMB 108.9107 million respectively, so the nature of the above funds and the nature of the transaction could not be confirmed.

On August 10, * ST Jitang opened with a limit of 1.93 yuan. On the afternoon of the 10th, daily economic news reporters repeatedly called the Secretary Office of * ST Jitang, but they were unable to get through.