GuoXuan high tech’s capital increase in Shenzhen stock exchange with 200 million debt of accounts receivable: damage to the company?

The website of Shenzhen Stock Exchange recently released a letter of concern about GuoXuan Hi Tech Co., Ltd. (No. 608 of SME board 2020). On December 26, 2020, GuoXuan Hi Tech Co., Ltd. (GuoXuan hi tech 002074. SZ) disclosed the announcement on foreign investment and capital increase of Tianjin Hengtian New Energy Automobile Research Institute Co., Ltd. and the announcement on termination of raised investment projects and permanent replenishment of the remaining raised funds to working capital. < / P > < p > according to the announcement on foreign investment and capital increase of Tianjin Hengtian New Energy Automobile Research Institute Co., Ltd., GuoXuan Hi Tech Co., Ltd. held the ninth meeting of the eighth board of directors and the ninth meeting of the eighth board of supervisors on December 24, 2020, deliberated and passed the proposal on foreign investment and capital increase of Tianjin Hengtian New Energy Automobile Research Institute Co., Ltd., the same as Hefei GuoXuan high tech power energy Co., Ltd. (hereinafter referred to as “Hefei GuoXuan”), a wholly-owned subsidiary of the Italian company, increased the capital of Tianjin Hengtian with a total amount of 214 million yuan of debt receivable from Tianjin Hengtian New Energy Automobile Research Institute Co., Ltd. (hereinafter referred to as “Tianjin Hengtian”). < / P > < p > Hefei GuoXuan, a wholly-owned subsidiary of the company, plans to sign the debt to equity swap agreement with Beijing Hengtian Xinneng New Energy Vehicle Technology Co., Ltd. (hereinafter referred to as “Beijing Hengtian”) and Tianjin Hengtian. Hefei GuoXuan plans to increase the capital of Tianjin Hengtian with its total receivables of RMB 214 million. < / P > < p > according to the asset appraisal report on the total equity value of shareholders of Tianjin Hengtian New Energy Automobile Research Institute Co., Ltd. involved in the debt to equity conversion project of Hefei GuoXuan high tech power energy Co., Ltd. issued by Watson (Beijing) International Asset Appraisal Co., Ltd. (Watson Ping Bao Zi [2020] No. 2013), as of the benchmark date of September 30, 2020, the asset-based method is adopted According to the basic law, the book value of owner’s equity of Tianjin Hengtian included in the appraisal scope is 67.8923 million yuan, and the appraisal value of all shareholders’ equity is 122.8329 million yuan on the premise of maintaining the existing use of continuous operation. The parties to this agreement propose to determine the debt to equity ratio of Hefei GuoXuan to Tianjin Hengtian based on the evaluation value. Hefei GuoXuan will make a new contribution to Tianjin Hengtian with its creditor’s rights totaling RMB 214 million. After the completion of this capital increase, the registered capital of Tianjin Hengtian will increase to RMB 82.1918 million. Hefei GuoXuan will hold 63.50% of the equity ratio of Tianjin Hengtian, and Beijing Hengtian will continue to invest The shareholding ratio of Tianjin Hengtian is 36.50%. After the capital increase, Tianjin Hengtian will become the holding subsidiary of the company and be included in the scope of consolidated statements. < / P > < p > Hefei GuoXuan increased its capital with a total of 214 million yuan of debt of accounts receivable of Tianjin Hengtian in previous years, of which 52.1918 million yuan was used as the new registered capital of Hefei GuoXuan, with a shareholding ratio of 63.50%. After the completion of the capital increase, the registered capital of Tianjin Hengtian increased to 82.1918 million yuan, and the remaining 161.5038 million yuan was included in the capital reserve of Tianjin Hengtian. < p > < p > the SME Board Management Department of Shenzhen Stock Exchange pointed out that Frank Engel, the director of GuoXuan hi tech, abstained from voting when the board of directors deliberated on the above-mentioned foreign investment matters. The reason for the abstention was that “it is temporarily unable to make a reasonable judgment on the investment prospect and expected return”. According to the assets appraisal report, the net profit of Tianjin Hengtian in the last two years was 11.6087 million yuan, 911 000 yuan and – 25.2839 million yuan respectively, showing an obvious downward trend; at the end of the third quarter of 2020, its asset liability ratio was as high as 89.89%, an increase of 9.63 percentage points compared with the end of the previous year. Please explain in detail the purpose and necessity of this transaction and whether there is any damage to the legitimate rights and interests of the listed company and shareholders in combination with the financial situation, main business and development of Tianjin Hengtian. < / P > < p > according to the announcement on terminating the raised investment project and permanently replenishing the remaining raised funds to the working capital, the company has been approved to issue 262926000 new shares to the original shareholders according to the reply on Approving the allotment of shares of GuoXuan Hi Tech Co., Ltd. (zjxk [2017] No. 1820) issued by China Securities Regulatory Commission. The company actually allotted 260.2308 million shares, with a price of 13.69 yuan per share. The total amount of funds raised was 3.563 billion yuan. After deducting the total issuance expenses of 27.9549 million yuan, The actual net amount of raised funds is RMB 3.535 billion, and the above raised funds have been verified by Huapu Tianjian Certified Public Accountants (special general partnership) and issued a verification report (hyz [2017] No. 5313). The company adopts a special account storage system for the raised funds. < / P > < p > GuoXuan hi tech plans to terminate the “annual output of 200000 sets of electric vehicle powertrain control system construction project”, which is implemented by Anhui GuoXuan New Energy Vehicle Technology Co., Ltd., a holding subsidiary of the company. The planned investment amount is 362.473 million yuan, and 250 million yuan will be invested with the raised funds. The construction period is up to June 2021, and the construction content of the project covers battery management system and electric vehicle The control system of the machine. As of November 30, 2020, the project has invested 4.4154 million yuan of raised funds, the investment progress of raised funds is 1.77%, and the remaining raised funds is 260.8157 million yuan (including interest income and financial income, and the actual transfer out amount is subject to the bank settlement balance on the day of transfer out). According to the “guidelines for the standardized operation of Listed Companies in Shenzhen Stock Exchange” and other relevant provisions, the company plans to use the above-mentioned surplus raised funds to permanently supplement the working capital for the production and operation activities related to the company’s main business. < p > < p > the management department of small and medium-sized board company of Shenzhen Stock Exchange pointed out that “the construction project of power train control system with an annual output of 200000 sets of electric vehicles” is the equity offering project of GuoXuan high tech in 2017. The original plan is to invest 250 million yuan. As of November 30, 2020, only 4.4154 million yuan will be invested, and the investment progress is 1.77%. GuoXuan high tech plans to terminate the above project and make up the surplus fund permanently Flow. Please explain the reasons why GuoXuan hi tech terminated the above-mentioned projects and made up the current permanently in combination with market environment and policy changes, strategic development and capital demand of GuoXuan hi tech. In addition, we will check whether the feasibility analysis report on the use of the original raised funds of GuoXuan hi tech carefully considers the changes and risks of the market and industry, and ask the sponsor to express clear opinions. < / P > < p > the management department of small and medium-sized board companies of Shenzhen stock exchange is highly concerned about the above matters. GuoXuan hi tech is requested to make a careful self-examination and a written explanation on the capital increase of Tianjin Hengtian, the formation of accounts receivable of 213695600 yuan, the evaluation of Tianjin Hengtian, the termination of the construction project and the permanent replenishment of the surplus raised funds, and submit the relevant explanatory materials to the management department of small and medium-sized board companies of Shenzhen stock exchange for disclosure before January 5, 2021, with a copy to An’an Listed company supervision division of Huizhou securities regulatory bureau. < / P > < p > on December 26, 2020, your company disclosed the announcement on foreign investment and capital increase of Tianjin Hengtian New Energy Automobile Research Institute Co., Ltd. and the announcement on termination of raised investment projects and permanent replenishment of the remaining raised funds to working capital. Hefei GuoXuan high tech power energy Co., Ltd. (hereinafter referred to as “Hefei GuoXuan”), a wholly-owned subsidiary of your company, intends to increase the capital of Tianjin Hengtian with the total amount of 213695600 yuan of debt receivable from Tianjin Hengtian New Energy Automobile Research Institute Co., Ltd. (hereinafter referred to as “Tianjin Hengtian”) 50%, Tianjin Hengtian will be included in the scope of your company’s consolidated statements. Secondly, your company plans to terminate the fund-raising investment project of “annual output of 200000 sets of electric vehicle powertrain control system construction project”, and use the surplus fund of 260.8157 million yuan of the project to permanently supplement the working capital. Our department is highly concerned about the above matters. When the board of directors of your company deliberated on the above foreign investment matters, Frank Engel, the director, abstained because “we can’t make a reasonable judgment on the investment prospect and expected income for the time being”. According to the assets appraisal report, the net profit of Tianjin Hengtian in the last two years was 11.6087 million yuan, 911 000 yuan and – 25.2839 million yuan respectively, showing an obvious downward trend; at the end of the third quarter of 2020, its asset liability ratio was as high as 89.89%, an increase of 9.63 percentage points compared with the end of the previous year. Please explain in detail the purpose and necessity of this transaction and whether there is any damage to the legitimate rights and interests of the listed company and shareholders in combination with the financial situation, main business and development of Tianjin Hengtian. < / P > < p > 2. Please explain the specific reasons for the formation of the above accounts receivable, maturity, aging and bad debt provision, and calculate the impact of the debt to equity swap on the company’s performance. In addition, in addition to the above accounts receivable, does Tianjin Hengtian have any other creditor’s rights and liabilities relationship with your company and other subsidiaries within the scope of consolidated statement? If so, please add the specific situation, liquidation plan and the reasons for not being fully converted into equity. < / P > < p > 3. Your company uses asset-based method and income method to evaluate the total equity value of Tianjin Hengtian shareholders. The evaluation result of income method is 74.22 million yuan, and the value-added rate is 9.32%. The evaluation result of asset-based method is 122.8335 million yuan, and the value-added rate is 80.92%. Your company selects the result of asset-based method as the final evaluation conclusion. Please explain the rationality of value-added assessment in combination with the assessment scope, important assessment assumptions, main assessment parameters and specific assessment process of asset-based approach. In addition, please add the reasons and rationality of the significant differences between the income method and the asset-based method, and whether the asset-based method is conducive to the protection of the interests of listed companies. The assessment agency is requested to express clear opinions. < / P > < p > 4. “200000 sets of electric vehicle powertrain control system construction project” is your company’s equity offering project in 2017. The original plan is to invest 250 million yuan. As of November 30, 2020, only 4.4154 million yuan has been invested, and the investment progress is 1.77%. Your company plans to terminate the above project and permanently replenish the surplus raised funds. Please explain the reasons for your company to terminate the above-mentioned projects and make up the current permanently in combination with market environment and policy changes, your company’s strategic development and capital demand. In addition, self check whether the feasibility analysis report on the use of the original raised funds of your company has carefully considered the changes and risks of the market and industry, and ask the sponsor to give a clear opinion. < / P > < p > please make a written explanation on the above problems, and submit the relevant explanatory materials to our department and disclose them to the public before January 5, 2021, with a copy to the supervision department of listed companies of Anhui securities regulatory bureau. < / P > < p > at the same time, remind your company: listed companies should be honest and trustworthy, operate in a standardized manner, and conscientiously and timely perform the obligation of information disclosure in accordance with national laws and regulations, the stock listing rules of the exchange and the guidelines for the standardized operation of listed companies. < p > < p > the purpose of this article is to convey more information, and it does not represent the views and positions of our website. 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