What is the significance of Dalian Zeus Entertainment Co.Ltd(002354) self rescue to the capital market?
Since February 18, the A-share listed company ” Dalian Zeus Entertainment Co.Ltd(002354) ” which has attracted widespread attention in the capital market has been officially renamed “Tianyu digital branch”.
As of the close, it was reported at 4.32 yuan / share, unchanged from yesterday.
On February 17, Dalian Zeus Entertainment Co.Ltd(002354) announced that the abbreviation of the company’s securities was changed from ” Dalian Zeus Entertainment Co.Ltd(002354) ” to “Tianyu digital Department”, and the securities code was still “002354”. He also said that this is to further improve the core brand image and brand value in line with the actual business situation and future strategic direction of the company.
After a series of crises caused by previous blind expansion, Dalian Zeus Entertainment Co.Ltd(002354) introduced a professional manager team, the risks were gradually resolved, and the operation gradually returned to the right track.
A special background is that for more than two and a half years, it has been in a state of no actual controller.
21st Century Business Herald reporter learned from insiders of the company on the 18th that after solving the “shell protection” problem, the company’s business has also been integrated.
Renamed three times
It is understood that this is not the first time it changed its name. Before ” Dalian Zeus Entertainment Co.Ltd(002354) “, it was once called “God interaction”. In 2014, Tianshen interactive backdoor Kemin wood was listed on A-share market and renamed ” Dalian Zeus Entertainment Co.Ltd(002354) ” the following year.
After the backdoor listing in 2014, Dalian Zeus Entertainment Co.Ltd(002354) Zhu ye, the largest shareholder and the original actual controller, became the chairman and concurrently served as the general manager. In the following three years, the company also made rapid progress in the capital market, with a cumulative foreign investment of more than 10 billion yuan and more than 70 equity and holding companies.
In 2018, the industry cooled down. Due to the blind and excessive expansion in the early stage, the company was plagued with debt, performance loss, goodwill impairment, litigation and asset freezing. In that year, Dalian Zeus Entertainment Co.Ltd(002354) had a performance loss of more than 7 billion yuan, and the amount of goodwill impairment was as high as 4.06 billion yuan.
Subsequently, Dalian Zeus Entertainment Co.Ltd(002354) was filed for investigation by the CSRC due to a series of violations that damaged the rights and interests of minority shareholders, such as illegal guarantee, capital occupation of major shareholders, interest transmission and letter Phi violations. The market value once fell to less than 3 billion yuan from 30 billion yuan at the end of 2015.
In the face of such a situation, minority shareholders chose to “hold together for warmth”. In September 2019, several directors’ candidates jointly nominated by minority shareholders were successfully elected, occupying the majority of seats on the board of directors, and the company ushered in the era of joint governance by minority shareholders.
In the absence of the actual controller, the company has resolved the debt crisis through judicial restructuring in the past two years, and set records such as “the fastest private enterprise in restructuring” and “China’s first internet light asset listed company in restructuring and self rescue”.
In May 2021, the company’s stock was “off the star and off the hat”.
At the same time, according to the development strategy of “E-sports drives games and data traffic drives the real economy”, the company sells and divests some businesses with weak synergy with the main business.
At present, the company has formed a dual business engine of e-games and data traffic in its main business, and data traffic has gradually become the core driving force of its revenue growth.
Self redemption
On the evening of January 28, 2022, the company released the performance forecast for 2021, and it is estimated that the net profit in 2021 will be 35-52 million yuan.
Tianyu digital branch said that the year-on-year decline in performance was mainly due to the large losses in the performance of some joint-stock companies, which had a great impact on the investment profits and losses recognized by the company under the equity method. At the same time, the company plans to make provision for the impairment of long-term equity investment for some joint-stock companies, which will also have an impact on the net profit.
From “loss king” to return to profitability, how does the company realize self redemption?
Xu Dewei, general manager of Tianyu digital division, once said at the company’s annual summary meeting in 2021 that 2020 is the year of life and death of the company, which has completed the resolution of huge debts, avoided delisting risks and realized the rebirth of adversity; 2021 is a year of strengthening the foundation, cultivating new growth points in the main business fields of E-sports games and data traffic, actively disposing the non-performing assets of the holding company that continue to lose money, and constantly optimizing the layout of assets and business.
Xu Dewei also stressed that 2022 will be the year of innovation and development of the company. The company will seek breakthroughs with innovation in the field of digital economy and promote the in-depth development of business. At the same time, it will further optimize the assets of the joint-stock company and completely solve the problems left over by history.
At present, the company has gradually focused its main business on the field of digital economy, focusing on leisure e-sports, digital marketing, virtual digital people and other businesses. Taking the digital economy tuyere, the share price rose by nearly 200% this year from the bottom.
Bohai Securities believes that on the whole, the company’s operation is still recovering, and it is expected that the company’s businesses will continue to be promoted in 2022. In the context of the release of some business risks in 2021, the overall business situation of young equipment in 2022 will be clearer.
After changing its name from ” Dalian Zeus Entertainment Co.Ltd(002354) ” to “Tianyu digital section”, what remains unchanged is that the ownership structure of the company is still relatively scattered.
By the end of the third quarter of 2021, the top five shareholders of Tianyu digital branch were Zhu ye, Chuangshi Shenyu No. 1 private equity fund, Weixin Co., Ltd., Zhixin No. 351 Dalian Zeus Entertainment Co.Ltd(002354) M & a project collective fund trust plan and Shi potao, with shareholding ratios of 7.85%, 5.74%, 4.03%, 3.2% and 2.59% respectively.
No actual controller
Under the leadership of the professional manager team, Tianyu digital department did not fall into the chaos of “no one at the helm”.
According to the introduction of Tianyu digital department, the new board of directors appointed a team of professional managers and put forward three strategies of “resolving debt, revitalizing stock and developing increment”. After introducing a new professional manager team, the company has completed many major events, such as “protecting the shell”, reorganizing the original business and developing new business.
At the same time, as Zhu ye, the major shareholder and the original actual controller, permanently gave up his voting right, Tianyu digital branch became a state without actual controller.
For the current situation of the company’s ownership structure, an insider of Tianyu digital Department told reporters, “now any shareholder of the company can not control the company, and neither shareholder of the board of directors can control the absolute seat.”
The 21st Century Business Herald reporter learned from this person that after the major shareholders gave up their voting rights, they almost fell into a “silent” state. During the period when there was no actual controller, the internal control of Tianyu Digital Division was strengthened, and all departments performed their respective duties, forming a benign corporate governance structure.
The above insiders also said that the state of no actual controller not only has no negative impact on the development and operation of the company, but also can play a good, positive and effective role in promoting.
In addition, the reporter noted that in June 2020, the company disclosed an equity incentive plan, which plans to grant 43.4 million stock options to 41 incentive objects, including senior executives and core backbone personnel of the company. The set exercise price is 3.18 yuan / share, the performance evaluation goal is to achieve profitability in 2020, and the net profit attributable to the parent company in 2021 is no less than 300 million yuan.
From the performance forecast of 2021, there is still a distance from the target of “net profit attributable to parent company in 2021 not less than 300 million yuan” mentioned in the equity incentive plan.
It is worth mentioning that, previously, some investors asked the Secretary of Tianyu digital science department, “is it possible for state-owned assets to take shares in the future?”
On January 27, the Board Secretary of Tianyu digital branch replied, “the company welcomes all investors to join in and work together to develop the company into a leading listed company in China’s digital economy.”
