On February 11, the second Department of management of listed companies of Shenzhen Stock Exchange issued a “letter of concern about Cedar Development Co.Ltd(002485) ” to Cedar Development Co.Ltd(002485) (002485. SZ), a listed company of cedar, about the explosion of 20 billion financial products of cedar holdings, which has been making a lot of noise recently. On February 14, Cedar Development Co.Ltd(002485) replied to the letter of concern.
In the reply, Cedar Development Co.Ltd(002485) didn’t mention the details of thunderbolt financial products too much. It only said that although the company and cedar trust are legal persons under the control of the same actual controller, the company and cedar trust are independent legal persons, completely separated in business, personnel, assets, institutions, finance and other aspects. Therefore, the operation of cedar trust will not have an impact on the company’s production and operation. At present, the operation of the company is normal.
In addition, according to the annual report, Cedar Development Co.Ltd(002485) controlling shareholder Guangzhou cedar Cultural Tourism Investment Co., Ltd. (hereinafter referred to as “Cedar cultural investment”) and its concerted actor Guangzhou Junkai Investment Co., Ltd. (hereinafter referred to as “Junkai investment”) hold 382 million shares of the company, accounting for 70.3% of the total share capital of the company, of which 373 million shares are pledged, with a pledge ratio of 97.44%.
On January 21, 2022, Cedar Development Co.Ltd(002485) 4895500 shares held by Junkai investment were frozen by the judiciary, accounting for 0.90% of the total share capital of the company.
In this regard, the Shenzhen stock exchange requires it to explain whether the controlling shareholder has the risk of stock pledge and liquidation, and whether the control right has the risk of instability.
In response, Cedar Development Co.Ltd(002485) replied that after verification with the controlling shareholder cedar cultural investment, the shares pledged by cedar cultural investment and its concerted actor Junkai investment do not have the risk of closing positions in the short term, which will not lead to the change of the actual control of the company. At present, the control of the company is stable. The joint and several guarantee liability of some shares of the company held by Junkai investment due to debt disputes was frozen by the judiciary.
Bulk commodities are cedar’s “starting” business. According to the 2021 semi annual report, Cedar Development Co.Ltd(002485) operating revenue is 959 million yuan, including 785 million yuan from supply chain trade, which is a new business type in 2020.
Cedar Development Co.Ltd(002485) said in the reply that the company’s supply chain trade business has been carried out since March 2020, mainly engaged in China’s supply chain management business focusing on steel, coal coke, oil and other categories. The business is true and effective, and the relevant business flow, logistics and information flow are clear. Business resources, channels, operations and risk control are operated independently by the company team. It is significantly different from the related party cedar bulk commodity supply chain Group Co., Ltd. in terms of operating categories, customers and suppliers, and there are no related party transactions such as purchasing and selling bulk commodities from related parties.
In addition, as of February 11, 2022, the guarantee balance provided by the company for related parties is 192 million yuan, and the relevant debts have expired. Xi’an Tiannan Cultural Tourism Co., Ltd. (hereinafter referred to as “Xi’an Tiannan”) is going through the repayment and extension procedures. If Xi’an Tiannan is unable to fulfill the repayment responsibility or fails to complete the extension procedures due to objective reasons, and other guarantee measures are invalid, the company has the risk of performing the guarantee responsibility.
The above-mentioned related party guarantee was passively formed due to the transfer of Xi’an Tiannan, the former holding subsidiary. At that time, the review procedure of related party guarantee had been re performed, and the related parties provided counter guarantee measures for the above-mentioned debts. The company has urged Xi’an Tiannan and its controlling shareholders to handle the repayment of relevant debts as soon as possible, and will pay close attention to the progress of the matter and fulfill the disclosure obligation in time according to relevant regulations.
