On December 27, Kennede Electronics Mfg.Co.Ltd(002723) (002723. SZ), in reply to the letter of concern of Shenzhen Stock Exchange, said that the company held a directors’ meeting on December 14, 2021 to consider the reasons and rationality for the company to promote the acquisition of 85% shares of Hangzhou Yuyou new consumer Technology Co., Ltd. (hereinafter referred to as “Yuyou new consumer”) despite serious differences between the board of directors, Each director discussed the company’s strategic development direction, acquisition time point, acquisition target business, counterparty performance compensation measures and other aspects, and voted on this transaction according to their own judgment. On December 24, 2021, the company convened the board of directors. After careful consideration, the board of directors unanimously agreed to terminate the acquisition of 85% shares of Yuyou new consumption.
The reporter of economic information daily noted that Kennede Electronics Mfg.Co.Ltd(002723) did not give a detailed reply on the grounds that the transaction had been terminated for the specific capital source of the above acquisition concerned by Shenzhen Stock Exchange and the value-added rate of yuyouxin’s consumption evaluation was as high as 864.94%.
On December 15, Kennede Electronics Mfg.Co.Ltd(002723) announced that it planned to transfer 60% equity of Yuyou new consumption held by Shanghai Heou and 25% equity of Yuyou new consumption held by Han Ding Yuyou with 298 million yuan in cash. After the acquisition, Kennede Electronics Mfg.Co.Ltd(002723) will hold 85% equity of Yuyou new consumption, and Yuyou new consumption will become the holding subsidiary of the company.
It is worth noting that the board of directors of Kennede Electronics Mfg.Co.Ltd(002723) had differences in the acquisition. The above acquisition was considered and approved by the board of directors convened by the company with 6 votes in favor, 0 votes against and 3 abstentions.
On December 16, Shenzhen Stock Exchange issued a letter of concern, requesting Kennede Electronics Mfg.Co.Ltd(002723) to explain matters related to the acquisition.
Kennede Electronics Mfg.Co.Ltd(002723) is one of the earliest enterprises engaged in the R & D, production and sales of rechargeable standby lighting lamps and rechargeable AC / DC fans in China. It has developed into a household appliance enterprise integrating R & D, production, sales and self import and export. The company’s small household appliance brand and market influence are becoming increasingly significant. From January to September 2021, Kennede Electronics Mfg.Co.Ltd(002723) achieved an operating revenue of 1.016 billion yuan, a year-on-year increase of 37.46%; The net profit attributable to the shareholders of the listed company was 7.1611 million yuan, a year-on-year decrease of 63.74%.
According to the announcement, Yuyou new consumption was initiated and established by handing Yuyou Media Technology Co., Ltd. (hereinafter referred to as “handing Yuyou”) on March 7, 2016, with a registered capital of 5 million yuan. Yuyou new consumption is a professional enterprise providing Internet comprehensive marketing services around consumer goods.
The appraisal report shows that as of the benchmark date of June 30, 2021, under the condition of continuous operation, the audited book value of total assets, total liabilities and net assets of yuyouxin consumption are 65.5601 million yuan, 25.7222 million yuan and 39.8378 million yuan respectively. According to the income method, the total equity value of shareholders of Hangzhou Yuyou new consumer Technology Co., Ltd. is 384 million yuan, with an estimated appreciation rate of 864.94%. The audit report shows that from January to June 2021, Yuyou new consumption realized an operating income of 46.1227 million yuan, a net profit of 9.0769 million yuan and a net cash flow from operating activities of 271500 yuan.
In the letter of concern, SZSE asked Kennede Electronics Mfg.Co.Ltd(002723) independent directors to further explain the detailed reasons for abstaining from voting on the above proposal, as well as the reasons and rationality for the company to promote the above transactions in the case of serious differences between the board of directors.
In response, Kennede Electronics Mfg.Co.Ltd(002723) replied that the directors discussed the company’s strategic development direction, acquisition time point, acquisition target business, counterparty performance compensation measures and other dimensions, and voted on the transaction according to their own judgment. On December 24, 2021, the company convened the board of directors. After careful consideration, the board of directors unanimously agreed to terminate the acquisition of 85% shares of Yuyou new consumption.
In addition, Shenzhen Stock Exchange also requires Kennede Electronics Mfg.Co.Ltd(002723) to disclose in detail the main business content, business development mode and business model of Yuyou new consumption, the basic situation, market prospect and competition pattern of the industry in which the relevant business is located, and whether it is engaged in “online Red live broadcasting”, “online red with goods” and other related businesses, Whether there is a situation of stock price speculation catering to hot concepts such as “online Red economy” and “MCN organization”.
Kennede Electronics Mfg.Co.Ltd(002723) said that since the establishment of Yuyou new consumption, relying on the media resources and rich video production experience accumulated by the shareholder Yuyou media in the long video field, Yuyou new consumption has actively provided Internet comprehensive marketing services around consumer goods, and aimed at customers’ product sales, brand promotion and other needs on the basis of in-depth understanding of customers’ products and brand development strategies, Formulate an integrated internet marketing solution in line with the customer’s brand and business development strategic plan. The business contents of Yuyou new consumption include content customization, short video production and distribution, brand agent operation and whole case marketing. The business development mode and business model provide customers with customized entertainment marketing integration, brand whole case content marketing, live broadcast agent operation, video Number agent operation and other services, and obtain corresponding service income.
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