Another private placement by state-owned shareholders to reduce their holdings in 4 years fair price transfer

 Another private placement by state-owned shareholders to reduce their holdings in 4 years fair price transfer

On November 26, Beijing Equity Exchange disclosed the latest set of financial equity transfer information. Among them, the most remarkable is that the state-owned holding enterprise Aerospace Investment Holding Co., Ltd. plans to transfer all 15% of its shares in the nuclear construction industry fund management Co., Ltd. (hereinafter referred to as the nuclear construction industry fund), with the transfer price of 3552628393 yuan.

The nuclear construction industry fund, registered in November 2016, was established under the leadership of China nuclear industry construction group. In addition to the sponsor and aerospace investment holding, the other three sponsor shareholders are: CDB finance, ABC international and China Life Asset Management.

After four years of shareholding, the state-owned shareholders transfer at par

On November 23, 2020, with the supervision and approval of the state owned assets supervision and Administration Commission of the State Council, China Aerospace Science and Technology Group Co., Ltd., the competent department of aerospace Investment Holding Co., Ltd., passed the resolution of the 45th meeting of the Fourth Board of directors of aerospace Investment Holding Co., Ltd., and agreed to the equity transfer.

According to the equity transfer information, nuclear construction industry fund management Co., Ltd., the equity target of this listing transfer, is a state-owned holding enterprise, and its legal representative is Yu Hongwei. Its establishment date is November 18, 2016, and its registered capital is 200 million yuan. Its business scope covers: equity investment management, investment management, asset management, industrial investment, venture capital.

The nuclear construction industry fund includes five shareholders. Among them, China nuclear industry group Capital Holding Co., Ltd. and China Development Finance Co., Ltd. hold 35% and 20% shares respectively, ranking the first and second largest shareholders; the other three shareholders Aerospace Investment Holding Co., Ltd., ABC International Enterprise Management Co., Ltd. and China Life Asset Management Co., Ltd. each hold 15% of the shares.

The transferor of the equity, aerospace Investment Holding Co., Ltd., is a state-owned holding enterprise, which was established on December 29, 2006. Its legal representative is Zhang Tao, with a registered capital of 120 million yuan. The proportion of holding property (stock) rights is 15%, and the proportion of assets (shares) to be transferred is 15%, which means that if the transfer is successful, aerospace Investment Holdings will completely fade out of the nuclear construction industry fund.

Four years ago, the company invested 30 million yuan for 15% shares. This time, it is planned to transfer all 15% shares at the bottom price of 3552628393 yuan. If the transaction is completed at the bottom price, it means that the total return of aerospace investment holdings in four years is only 18.4%! After deducting the cost of capital in the past four years, it is almost fair price transfer!

Turning losses into profits, why exit by clearing positions?

Since this year, private funds have been reduced by state-owned shareholders. In September this year, Dongfang venture capital holdings listed on the equity exchange to transfer 45% of the equity of Shenzhen Dongfang Ruichen fund. Due to the poor management of the latter and successive losses, it is not difficult to understand that the state-owned assets have been reduced.

According to the financial data of the nuclear construction industry fund, its operating income, operating profit and net profit in 2019 are 8.4548 million yuan, - 12.3377 million yuan and - 12.3377 million yuan respectively. By 2020, its financial situation has improved significantly. As of October 31, 2020, the above three indicators are respectively 25886800 yuan, 6780800 yuan and 6780800 yuan.

For the financial data of nuclear construction industry fund in recent two years, its profit index has turned from loss to profit. Four years ago, high-profile shareholders of state-owned assets, but why did they withdraw after four years? Why is the transfer of equity by public listing close to parity?

For state-owned enterprises, maintaining and increasing the value of state-owned assets is not only the significance of investment, but also the consideration of state-owned assets. A person familiar with state-owned holding enterprises said that if the profit rate is not high, it is tolerable, but no one can bear the responsibility of loss of state-owned assets.

In the official introduction of aerospace Investment Holdings, there is also the word value maintenance and appreciation of state-owned assets - focusing on business incubation, resource integration, strategic M & A, investment and financing, etc., to realize the value maintenance and increase of state-owned assets through market-oriented means, and promote the sound and rapid development of aerospace civil industry.

Four years after its establishment, although the profit index of the nuclear construction industry fund has turned from deficit to profit, its asset index and liability index are not optimistic. By the end of October 2020, its total assets, total liabilities and owners equity were 191397400 yuan, 1084500 yuan and 190312900 yuan respectively, especially the total assets were less than 200 million yuan of registered capital.

It is reported that the announcement period of the equity transfer is 20 working days from the date of announcement, that is, from November 26, 2020 to December 23, 2020. Who can become the new shareholder of nuclear construction industry fund? Well see.

Source of this article: Yang Bin, editor in charge of CFA_ NF4368