The trading limit was touched during the session, and the trading price of RMB 3.343 billion was disclosed on the same day, Western Mining Co.Ltd(601168) so received the letter of supervision.
On January 1, Western Mining Co.Ltd(601168) disclosed the inquiry letter of Shanghai Stock Exchange on matters related to the company’s related party transactions. Earlier, on February 28, Western Mining Co.Ltd(601168) announced that it planned to purchase 27% equity of Qinghai Dongtai Jinaier lithium resources Co., Ltd. (hereinafter referred to as “lithium resources company”) from the controlling shareholder Western Mining Co.Ltd(601168) Group Co., Ltd. (hereinafter referred to as “West Mining Group”). The transaction amount is large and constitutes a connected transaction.
Source: Western Mining Co.Ltd(601168) announcement
According to regulations, the Shanghai stock exchange requires Western Mining Co.Ltd(601168) to verify and supplement the disclosure of the following matters:
First, the announcement shows that on May 20, 2015, lithium resources company was established and registered, and the controlling shareholder West Mining Group subscribed 162 million yuan, accounting for 27%. At present, the company purchases 27% equity of the above lithium resources company from western group at a consideration of 3.343 billion yuan.
Supplementary disclosure: (1) the transaction background and main considerations of the acquisition of the participation right of lithium resources company from the controlling shareholder at a high premium ; (2) Combined with the composition of the board of directors and the operation decision-making mechanism of lithium resources company, this paper explains how to realize the business coordination between the company and lithium resources company and promote the development of the company after undertaking the above equity participation of western group. (3) In combination with the market price fluctuation of the main products of lithium resources company since 2015, quantitatively explain the reason and rationality of the high premium of the underlying asset valuation .
Second, the announcement shows that the lithium resources company is currently mainly engaged in the development of lithium resources in the East Taijinar Salt Lake, processing and producing lithium carbonate products. Its lithium boron potassium comprehensive development project was approved and filed in July 2016, with a total investment of 3.286 billion yuan. At present, a battery grade lithium carbonate production line with an annual output of 20000 tons has been built and operated.
Supplementary disclosure: (1) the technology development of the contract industry and the situation of comparable companies, and quantitatively explain the development and application of the core technology of lithium resources company; (2) The specific development progress, expected completion time limit and the amount to be invested of the lithium boron potassium comprehensive development project; (3) The main customers of lithium resources company, whether they are related and stable.
Third, the announcement shows that the consideration of this transaction is determined according to the assessed value of lithium resources company. The appraisal adopts the asset-based method and the market method, and finally selects the appraisal result adopting the asset-based method. In this appraisal, the total equity value of the target assets is 12.38 billion yuan, and the appraisal appreciation rate is 954.07%.
Supplementary disclosure: (1) whether the counterparty provides the profit guarantee, compensation commitment or repurchase commitment of the transaction subject within a certain period of time. If not, explain the specific reasons, whether relevant safeguard measures are taken, and whether it is conducive to protecting the interests of listed companies and the legitimate rights and interests of minority shareholders. (2) The asset based method is adopted to evaluate the asset items with high value-added and the specific reasons, so as to explain the rationality of the valuation.
Fourth, the announcement shows that the consideration of this transaction is RMB 3.343 billion, 80% will be paid to west mining group within 5 trading days after the signing of this transaction contract, and the remaining 20% will be paid in one time within 5 working days from the date of completing the industrial and commercial change registration of the subject equity of the target company.
Supplementary disclosure: (1) the specific capital source of this acquisition , including but not limited to the payment proportion and amount of self owned funds and bank loans, bank loan interest rate and repayment term, etc; (2) In combination with the deposit and restriction of monetary funds, explain the impact of the above payment arrangements on the company’s financial expenses, asset liability ratio and daily operating liquidity .
Fifth, the company’s share price hit the intraday limit on the day of submission of the announcement, closing up 9.32%. Self check the insider registration and insider information control, indicating whether the insider information control system is sound and whether the relevant provisions on insider information control are strictly implemented in the whole process of transaction planning and disclosure . In addition, the company submitted the list of insiders and checked whether there was any disclosure of insider information in advance .
Statistics show that Western Mining Co.Ltd(601168) Group Co., Ltd. was established in 2000, formerly known as Xitieshan Mining Bureau. In 2007, its Western Mining Co.Ltd(601168) was listed on the Shanghai Stock Exchange, and the actual controller was Qinghai SASAC.
As of the closing on March 1, Western Mining Co.Ltd(601168) closed up 6.63%, offering 17.38 yuan, with a total market value of 41.42 billion yuan.
