Securities code: 000637 securities abbreviation: Maoming Petro-Chemical Shihua Co.Ltd(000637) Announcement No.: 2022-017 Maoming Petro-Chemical Shihua Co.Ltd(000637)
Announcement on the reply to the letter of concern (No. 55) of Shenzhen Stock Exchange
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.
On January 26, 2022, Maoming Petro-Chemical Shihua Co.Ltd(000637) (hereinafter referred to as "the company" or " Maoming Petro-Chemical Shihua Co.Ltd(000637) ") received the notice on Maoming Petro-Chemical Shihua Co.Ltd(000637) from the management department of listed companies of Shenzhen Stock Exchange (company Department notice [2022] No. 55, hereinafter referred to as "the notice"). After that, the company conducted verification and Analysis on the matters involved in the letter of concern, and asked the appraiser to express clear opinions on the verification of relevant matters. The company has replied to Shenzhen Stock Exchange, and now it is announced as follows:
Matters of concern of the letter:
1. Xinwoda ocean is mainly engaged in the business of displaying, domesticating and breeding marine organisms. This acquisition is a cross industry acquisition. Please supplement and disclose:
(1) Combined with the development of main business, explain the main considerations in planning cross industry M & A, whether they have the necessary personnel, technology and business reserves for controlling, managing and operating the target assets, and whether cross-border M & A is prudent.
Reply of the board of directors:
(1) Since its establishment in 1988, the company has been mainly engaged in chemical industry, mainly engaged in the production, R & D and sales of petrochemical products. Its main products include liquefied petroleum gas, polypropylene, MTBE, special industrial white oil, ethanolamine, polymeric isobutane, propane, industrial hydrogen peroxide (27.5% / 35%), dicyclopentadiene (high-purity grade / polyester grade), hydrocarbon 9 Petroleum resin, naphthalene and heavy tar series. At present, the company has two production bases in Maoming and Zhanjiang. The main chemical production units in Maoming base include more than 10 sets of production units, such as 220000 T / a polypropylene, 500000 T / a gas separation, 80000 T / a raw material pretreatment and MTBE, 160000 T / a C4 extraction, 60000 t / a special white oil, 20000 t / a ethanolamine, etc; There are 300000 t / a hydrogen peroxide, 140000 T / a cracking C9 and cracking tar comprehensive utilization units in the chemical plant of Zhanjiang base. From 2016 to 2020, the operating revenue of the company was 2960.25 million yuan, 4407.68 million yuan, 4319.89 million yuan, 4298.16 million yuan and 3997.92 million yuan respectively, and the net profit was 73.58 million yuan, 117.79 million yuan, 40.28 million yuan, 113.14 million yuan and - 370000 yuan; Net assets attributable to listed companies: 855.14 million yuan, 901.81 million yuan, 858.57 million yuan, 942.01 million yuan and 908.9 million yuan; The company maintains a relatively stable development trend. However, under the background of "double carbon" and "double control", the development prospect of high-energy consumption chemical projects is affected, the competition in China's chemical market is becoming more and more fierce, the difficulties, challenges and bottleneck constraints faced by the company's main chemical industry are becoming increasingly prominent, and the pressure of survival and development is increasing. Based on the strategic development needs of expanding new business, accelerating transformation and development and optimizing industrial layout, the company adapts to the new situation of changing development ideas and improving development quality. After careful decision, while doing a good job in the existing main petrochemical industry and maintaining stability, the company plans to purchase 69% equity of Beijing xinwoda Marine Technology Co., Ltd. with 420 million yuan in cash to carry out dual main business operation, This is conducive to practicing the concept of green and low-carbon development, accelerating transformation and development, opening up new business areas and enhancing economic strength.
At present, the company has 287 employees with bachelor degree or above and 76 employees with medium and senior professional titles. As an old enterprise and a company that has been listed for a long time, although it has a certain foundation and accumulation in management control, technology, operation and sales, and has a relatively perfect internal control system, the company treats the challenges and risks in new fields with caution. The company employs special institutions such as audit, evaluation, legal and feasibility study to work. The strategy committee of the board of directors (5 members) held a video communication meeting on January 23 to study and discuss the acquisition. Four members agreed to submit the proposal to the board of directors for deliberation, while one member disagreed. On the 24th, the company held the eighth interim meeting of the 11th board of directors by on-site combined with video communication. The matter was adopted by 7 votes in favor, 2 against and 0 abstention. On the 24th, the company held the second interim meeting of the 11th board of supervisors by on-site combined with video communication. The matter was considered and adopted by 2 votes in favor, 1 vote against and 0 abstention. This proposal still needs to be considered by the general meeting of shareholders of the company. If this transaction is completed, the company will seriously strengthen learning, management and risk control in accordance with laws and regulations, rules and regulations and the articles of association of the company and the target company, and strengthen the control, management and operation of the target company by relying on the existing personnel, technology and systems. The labor relationship between the target company and its employees continues to exist effectively, the organizational structure and personnel of the target company are not significantly adjusted, and the existing management, core technical personnel and staff team remain generally stable, which will be conducive to the stable and sustainable operation and management of the target company. The company will assign three directors and one supervisor to xinvoda ocean, reorganize the board of directors and the board of supervisors, assign chief financial officer and heads of some important positions, formulate new articles of association, form a new governance structure and effectively exercise management and control. After years of development, xinvoda ocean has an experienced operation and management team, and its own management system and workflow are relatively sound. The company will maintain the business operation independence, management and business continuity of the target company, give full play to the operation and management expertise of the original management team, continue to optimize and integrate, and improve the management level and business performance of the target company.
(2) In combination with the arrangement of the management and business team of the subject matter of the post acquisition transaction, explain whether the relevant internal control system of the company's foreign investment and control is sound and effectively implemented, whether the subject matter can be effectively controlled, and fully prompt the risk.
Reply of the board of directors:
After this acquisition, simvoda ocean will become the holding subsidiary of the company and be included in the consolidation scope of the company's financial statements. The company will implement measures in all links in accordance with the principle of "overall stability, effective control, standardization and order" and the provisions of the company's foreign investment management system and the management measures for wholly-owned (holding subsidiaries), so as to effectively control the target company. However, due to the differences in region, industry and development process, management concept and corporate culture, it takes a certain time to integrate after the completion of the transaction, which may bring some integration risks. The company will strengthen the management of xinvoda ocean in accordance with the requirements of listed corporate governance and give full play to the enthusiasm of managers to reduce the integration risk. The injection of xinwoda ocean Shenzhen New Industries Biomedical Engineering Co.Ltd(300832) will have a certain impact on the company's original management and governance pattern, and put forward higher requirements for the company's operation and management, including organizational structure, management system, internal control, incentive mechanism and talent construction, thus bringing certain risks to the company's operation and management. In short, although the investment has been analyzed and demonstrated, there are still risks such as policy change, market change, cross industry and operation and management. The company will actively pay attention to the macro environment, industry policies and the progress of the work of the target company, fulfill the obligation of information disclosure, and invite investors to pay attention to investment risks.
(3) This transaction purchases 69% of the equity of the target company, indicating the arrangement for the remaining equity. Reply of the board of directors:
The company plans to acquire 69% equity of Beijing xinvoda Marine Technology Co., Ltd. held by Beijing Xinyu Investment Center (limited partnership) in cash. According to the counterparty, xinvoda ocean and its shareholders have negotiated the transfer of the remaining 31% equity with a company, which has no relationship with the company.
2. When the board of directors and the board of supervisors of your company deliberated the proposals related to this transaction, two directors and one supervisor voted against it. Please make supplementary disclosure:
(1) The main reason why the two Directors voted against is that the law firm's due diligence report on how to effectively resolve the risks prompted by the acquisition case is still unclear, and the subsequent face greater capital pressure, so it is appropriate to avoid risks and continue to focus on the main business. Please explain whether the transaction has undergone sufficient and reasonable demonstration and due diligence, as well as specific measures to resolve relevant risks in combination with the specific contents of the risks prompted in the due diligence report of the law firm.
Reply of the board of directors:
As it was a cross industry acquisition, the company treated the transaction carefully, hired Shanghai jintiancheng (Beijing) law firm to conduct legal due diligence on the transaction and issued a legal due diligence report. At the same time, it also hired Asia Pacific (Group) accounting firm (special general partnership) ZTE huazi (Beijing) real estate appraisal Engineering Consulting Co., Ltd. and Beijing Yinxin Ruida Financial Consulting Co., Ltd. respectively issued audit, appraisal and feasibility study reports for this transaction. In addition, the company held the strategic committee meeting of the board of directors, the meeting of the board of directors and the meeting of the board of supervisors to review the transaction. To sum up, the company has conducted sufficient and reasonable demonstration and due diligence on this transaction.
In combination with the legal due diligence issued by the law firm on this acquisition, the company expounds the main legal risks involved in this transaction and the specific solutions to resolve relevant risks as follows:
① The allocated land for the construction of the aquarium will expire in December 2023
The land for the construction of Beijing Aquarium is allocated land, and the termination date is December 10, 2023. For the renewal of allocated land, according to the provisions of relevant laws and regulations such as the catalogue of allocated land, the Beijing Aquarium operated by xinvoda ocean is for profit and does not comply with the principles and regulations of the use of allocated land, so there is a risk that it cannot be renewed.
[resolution measures] at present, because the use period of the allocated land has not expired, the relevant government departments will not issue a clear opinion on whether the allocated land where the Beijing Aquarium is located can be transferred to the land for transfer. Therefore, it is unclear whether the expiration of the land use period will really affect the operation of xinvoda ocean. The company has entrusted an intermediary agency to consult with the relevant departments of Beijing municipal government. According to the relevant laws and regulations, it is legally feasible to transfer the allocated land to the transferred land. After completing the acquisition procedures, the company will actively learn from the relevant government departments about the municipal planning arrangement of Beijing Aquarium, the process of transferring the land to the transferred land, the transfer fee to be paid, etc.
② Leased allocated land
On January 10, 2016, xinwoda ocean signed the property lease contract with Beijing Zoo. Xinwoda ocean leased the 42912.37 ㎡ property owned by Beijing Zoo located in the square outside the Beijing Aquarium building ("square") and the parking lot outside the Beijing Aquarium ("parking lot"), including 32217.45 ㎡ square and 10694.92 ㎡ parking lot. The lease term is from January 1, 2015 to October 15, 2023.
Since the property right certificate of the leased land is not provided by xinvoda ocean, the leased land may be allocated in nature. According to the provisions of laws and regulations such as the Interim Regulations on the assignment and transfer of urban state-owned land use right, if the lessor Beijing Zoo leases the allocated land without approval or / and fails to pay the land income contained in the rent, Beijing Zoo may be subject to the risk of administrative punishment, which may lead to the risk of terminating the lease contract with xinwoda ocean in advance or not renewing the lease contract.
[resolution measures] as the property lease contract signed between xinwoda ocean and Beijing Zoo has lasted for many years, it has maintained a friendly renewal relationship in the past. Beijing Zoo has never been subject to administrative punishment for renting the land to xinvoda ocean. Beijing zoo can also obtain rental income from renting land, and can also share the tourist flow of xinvoda ocean. It is a community of interests with xinvoda ocean and can continue to rent the house through communication with Beijing Zoo, which is more likely to be renewed smoothly. As for whether the land lease of Beijing Zoo is legal and compliant, it is a matter of negotiation between Beijing Zoo and relevant parts of the state. The company will actively cooperate and strive for legal renewal.
③ There are undocumented buildings, structures or temporary buildings in and around the Beijing Aquarium. There are two undocumented properties in the Beijing Aquarium where xinwoda ocean has obtained the real estate property right certificate. At the same time, in addition to the main hall of Beijing Aquarium, xinwoda ocean has more than 10 buildings, structures and temporary buildings without ownership certificates, such as the North Gate Office Building of Beijing Aquarium Canteen office building, direct combustion engine building, dressing room building, east public toilet, etc.
Since the land-use right of the land where these unlicensed houses are located is Beijing Zoo, these houses were built by Beijing Lida Marine Biology Museum Co., Ltd. after the company went bankrupt, xinvoda ocean purchased the assets including these houses. Xinvoda ocean is unable to provide the relevant land use planning permit, construction engineering planning permit Construction permits and other licenses, so these houses may be "built before approval", and face the risk of being demolished within a time limit, confiscated in kind or illegal income and fines by relevant departments as illegal buildings.
[resolution measures] these undocumented houses are long-term historical problems, and the risk of undocumented houses being demolished and punished by the competent department is low. Beijing Aquarium has been in operation for more than 20 years, and its main business has not been affected by this historical problem. According to interviews with relevant personnel and inquiries through public channels, the unlicensed houses owned by the company have not been demolished and punished by the competent authorities. The company believes that the failure to apply for the property right certificate is a historical reason, and the failure to apply for the property right certificate does not affect the continuous use of the company. After completing the acquisition procedures, the company will actively communicate with the competent department of land and housing, strive to obtain the written confirmation document issued by the competent department and the land right owner that these properties will continue to be used by the company, and strive for the competent department to issue the written confirmation document that there are no major violations or no punishment for the construction and construction of these properties.
In view of the defects and risks of the above land use of xinwoda ocean and Beijing Aquarium, the controlling shareholder of the company, Beijing Taiyue Real Estate Development Co., Ltd. ("Beijing Taiyue") promises to actively urge the company to implement and solve the problems in accordance with the above measures, so as to avoid adverse impact on the subsequent operation of the company, If the company fails to continue to lease or use these properties or bear any losses due to the above land, Beijing Taiyue will fully compensate the company for the expenses or losses incurred, and the company is not required to pay any consideration.
④ Some organisms are purchased or leased through import
Dolphins, beluga whales and other organisms in xinvoda's marine biological assets come from imports. Due to the impact of covid-19 epidemic in 2020, China has suspended the import of wild animals. In addition, six zebra billed ring penguins in xinvoda ocean are leased from
