China Securities Co.Ltd(601066)
Special opinions on adjusting the stock opening reference price on the next trading day after the equity registration date of Henan Huaying Agricultural Development Co.Ltd(002321) this capital reserve converted into share capital Shenzhen Stock Exchange:
On November 20, 2021, Henan Xinyang intermediate people's Court (hereinafter referred to as "Xinyang intermediate people's court" or "court") made (2021) Yu 15 Po Shen No. 4 civil ruling and (2021) Yu 15 Po No. 6-1 decision, and ruled to accept the creditor Huangchuan Ruihua Supply Chain Management Co., Ltd.'s civil ruling on Henan Huaying Agricultural Development Co.Ltd(002321) (hereinafter referred to as "Huaying agriculture" or "Listed company") and appointed Beijing Jindu (Shenzhen) law firm and Zhongqin Wanxin Certified Public Accountants (special general partnership) Henan Branch as Huaying agricultural manager.
On December 22, 2021, the first creditor meeting and investor group meeting of Huaying agriculture were held, The creditors' meeting voted and approved the Henan Huaying Agricultural Development Co.Ltd(002321) reorganization plan (Draft) (hereinafter referred to as the "reorganization plan"), and the investors' group meeting voted and approved the scheme for adjusting the rights and interests of investors in the Henan Huaying Agricultural Development Co.Ltd(002321) reorganization plan (Draft). On the same day, Xinyang intermediate people's Court issued (2021) Yu 15 Po No. 6-1 civil ruling according to law, ruling to approve the reorganization plan of Huaying agriculture And terminate the Huaying agricultural reorganization procedure.
According to the reorganization plan, this reorganization will take the existing total share capital of Huaying agriculture 534291100 shares as the base, and convert the capital reserve into shares according to the proportion of about 29.92 shares for every 10 shares, A total of 1598598971 shares can be converted into shares (the final actual number of shares converted into shares is subject to the number actually registered and confirmed by csdct Shenzhen Branch). After the conversion, the total share capital of Huaying agriculture will increase to 2132890071 shares. The above converted shares will not be distributed to the original shareholders, but will be arranged according to the following investor's equity adjustment scheme:
1. In order to raise debt repayment resources, solve the occupation of funds by controlling shareholders and restore the sustainable profitability of Huaying agriculture, restructuring investors will be introduced during the implementation of the restructuring plan. After selection, Shanghai xinxingding Asset Management Co., Ltd. or its designated entity as industrial investor and financial investor jointly as restructuring investor.
2. In order to resolve the Huaying agricultural debt crisis as a whole, about 531963958 shares of the converted shares will be used to pay off the creditor's rights in accordance with the creditor's rights repayment scheme specified in the reorganization plan.
The exact number of the above converted shares shall be subject to the number actually registered and confirmed by China Securities Depository and Clearing Corporation Shenzhen Branch.
China Securities Co.Ltd(601066) (hereinafter referred to as "the financial consultant"), as the financial consultant of Huaying agriculture, after careful research, it is considered that the reference price of stock opening on the next trading day on the equity registration date needs to be adjusted in combination with the actual situation of the reorganization plan for the conversion of capital reserve into share capital in the reorganization of Huaying agriculture. The details are as follows:
1、 Proposed adjustment to the stock opening reference price on the trading day next to the equity registration date
According to article 4.4.2 of the trading rules of Shenzhen Stock Exchange (revised in March 2021): "the calculation formula of ex right (interest) reference price is:
Ex right (interest) reference price = [(previous closing price - cash dividend) + allotment price × Share change ratio] ÷ (1 + share change ratio)
When the securities issuer deems it necessary to adjust the above calculation formula, it may apply to the bourse for adjustment and explain the reasons. With the consent of the exchange, the securities issuer shall publish the calculation formula of the ex right (interest) reference price applicable to the ex right (interest) to the market. "
Since the capital reserve converted into share capital is a part of the adjustment of investors' rights and interests in the reorganization procedure, it is different from dividend and share distribution in the general sense, According to article 4.4.2 of the trading rules of Shenzhen Stock Exchange (revised in March 2021), it is proposed to adjust the stock opening reference price on the next trading day on the equity registration date of the conversion of capital reserve into share capital. The adjustment formula is:
Stock opening reference price on the next trading day on the equity registration date = [(previous closing price - cash dividend) × Total share capital before conversion + amount of converted shares to offset debts + cash paid by restructuring investors for transferring converted shares] ÷ (total share capital before conversion + number of converted shares to offset debts + number of converted shares transferred by restructuring investors + increase in circulating shares due to distribution to original shareholders)
In the above calculation formula, the total share capital before the conversion is 534291100 shares, and the amount of converted shares to offset the debt is 4016327900 yuan, The cash paid by restructuring investors for the transfer of shares was 665476900 yuan (the total investment is 755.3106 million yuan, deducting the amount after repaying the Occupied Funds of 89.8337 million yuan); the number of shares converted from debt repayment is 531.964 million shares, and the number of shares transferred by restructuring investors is 1066.635 million shares; the converted shares are not distributed to the original shareholders, resulting in the increase of Liutong shares of 0.
Under comprehensive calculation, the average price of Huaying agriculture converted into shares is 2.93 yuan / share [(7.55 yuan / share) × 532 million shares + RMB 0.6239/share × 1067 million shares) ÷ (532 million shares + 1067 million shares)].
If the closing price of the company's shares on the equity registration date is higher than 2.93 yuan / share, the company's shares shall adjust the stock opening reference price on the trading day next to the equity registration date according to the above calculation formula; If the closing price of the company's shares on the equity registration date is less than or equal to 2.93 yuan / share, the opening reference price of the company's shares on the next trading day on the equity registration date will not be adjusted. 2、 The rationality of the adjustment of the stock opening reference price on the trading day after the equity registration date
1. The conversion of the capital reserve into share capital will be implemented after the ruling and approval of Xinyang intermediate people's court. According to the reorganization plan, the converted shares will not be distributed to the original shareholders, and some shares will be conditionally transferred by the reorganization investor. The transferred consideration will be used to pay the reorganization expenses, pay off some debts and supplement the company's working capital, and the remaining converted shares will be used to offset debts with shares to ordinary creditors, The original shareholders of the company did not actually obtain the converted shares. According to the arrangement of the reorganization plan, after the increase, the company has obtained the funds invested by investors while increasing its share capital. The implementation of debt repayment with shares for more than 500000 ordinary creditors has correspondingly reduced the company's liabilities, fundamentally improved the asset liability structure and significantly increased the owner's equity, The number of shares held by the original shareholders of Huaying agriculture has not changed. In this case, we need to consider the impact of various factors on the real value of the company's shares.
2. During the reorganization, the reorganization investors transferred 1066635013 shares of the company into shares as a whole, The amount of consideration provided is about 665476900 yuan (the total investment is 755310600 yuan, deducting the amount after repaying the Occupied Funds of 89833700 yuan); the creditor has transferred 531963958 shares of the company into shares to offset the debt of about 4016327900 yuan. All the shares formed by the conversion of capital reserve into share capital are used to attract capital and repay debts. The reorganization investor pays the consideration in cash and the creditor pays the consideration in creditor's rights. This behavior is not allowed Under unusual circumstances, the act of placing purely to all the original shareholders of a listed company is closer to a market-oriented and negotiated transaction.
3. After the completion of this reorganization, Huaying agriculture's debt will be paid off 100% in the form of "cash repayment + debt repayment with shares" in accordance with the provisions of the reorganization plan. With the investment of funds and resources by the reorganization investors, Huaying agriculture's net assets will be greatly increased, the financial cost will be significantly reduced, the operating performance will continue to improve, and the net profit per share will change from negative value before the reorganization to positive value, The value of shares owned by shareholders will increase accordingly. According to the restructuring investment agreement, while helping the company get rid of the current operating difficulties, the restructuring investors will provide all-round help and support for the sustainable development of the company, including resource docking of all-round industrial chain, so as to promote the company to explore the market and supplement experienced managers to improve the internal operation efficiency and governance ability of the company Provide direct or indirect financing support to improve the company's financing ability, etc. On the premise that the restructuring investor as the controlling shareholder of Huaying agriculture and the relevant laws, regulations, policies and economic environment of the industry have not undergone significant adverse changes, the net profit of Huaying agriculture will grow steadily.
3、 Special opinions
To sum up, the financial adviser believes that in order to promote the smooth implementation of Huaying agricultural restructuring plan, and considering that the company's share price needs to reflect the fair value of Huaying agricultural after the fundamental improvement and expansion of share capital through restructuring, Therefore, it is necessary to adjust the stock opening reference price on the trading day next to the equity registration date of Huaying agriculture's conversion of capital reserve to share capital according to the actual situation.
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