Western Securities Co.Ltd(002673)
Special verification opinions on issues related to the inquiry letter on the draft of Guangdong Mingzhu Group Co.Ltd(600382) major asset restructuring issued by Shanghai Stock Exchange Shanghai Stock Exchange:
Western Securities Co.Ltd(002673) as the independent financial adviser of Guangdong Mingzhu Group Co.Ltd(600382) (hereinafter referred to as "listed company", "600382}" or "Guangdong Pearl") for the sale of major assets and the purchase of assets and related party transactions, on the inquiry letter on the draft reorganization of Guangdong Mingzhu Group Co.Ltd(600382) major assets (szgh [2021] No. 3000) issued by your ministry on December 17, 2021 and the inquiry letter on the draft reorganization of Guangdong Mingzhu Group Co.Ltd(600382) major assets issued on December 24, 2021 The relevant issues involved in the three inquiry letters of the draft of Guangdong Mingzhu Group Co.Ltd(600382) major asset restructuring (SSE Gong Han [2021] No. 3022) have been verified. The verification is reported as follows for your review.
Unless otherwise specified, the interpretation adopted in this verification opinion is consistent with the report on sale and purchase of Guangdong Mingzhu Group Co.Ltd(600382) major assets and related party transactions (Draft).
[reply to first inquiry]
1、 About transaction scheme
Question 1 About transaction arrangements. The draft discloses that the transaction plan includes two parts: asset sale and asset purchase. The company plans to sell 92% equity of Guangdong Mingzhu group urban operation and Development Co., Ltd. (hereinafter referred to as urban transportation company) to Xingning urban investment and Development Co., Ltd. (hereinafter referred to as Xingning urban investment), and Guangdong Dading Mining Co., Ltd. will be purchased by Guangdong Mingzhu Group Mining Co., Ltd. (hereinafter referred to as Mingzhu mining), a wholly-owned subsidiary of the listed company (hereinafter referred to as Dading mining) operating asset package, the above transactions are mutually prerequisite. The company is requested to make supplementary disclosure: explain the reasons, objectives and main considerations of this package deal in combination with the company's operation, capital occupation and other major risks. The financial consultant is requested to give opinions.
reply:
1、 Major risks faced by the company
At present, the company is faced with the risk that its main business is not sustainable, the risk that the company's large amount of funds are occupied by the company controlled by the actual controller, and the risk that the company faces delisting due to the above risks. Specifically: (I) the risk that the company's main business is not sustainable
The company's main business includes first-class land development business and trade business. The primary land development business is the most important part of the company's main business income and profit in recent years. The details are as follows:
Unit: 10000 yuan,%
January September 2021 2019 2018
Business type
Proportion of income proportion of income proportion of income proportion of income proportion of income
Class I land development 15235.2079 3253,035.2394. 4044,168.1882. 402,622.2820. thirty-three
Trade 3970.8720 683,147.695. 609,432.4017. 6010,276.8379. sixty-seven
Total: 19206.07100 0056,182.92100. 0053,600.58100. 0012,899.11100. 00
Primary land development business refers to participating in the first phase of primary land development and some public facilities construction projects of Xingning Southern new town since 2014. According to the cooperation agreement on first stage land development and some public facilities construction of Xingning Southern New Town signed by Xingning Municipal People's government and Guangdong Pearl on November 20, 2014, urban transportation company, as the only development subject, provided funds for land acquisition, demolition, resettlement, supplement and public facilities construction of Southern New town. The project was launched in November 2014, The development cycle of the project is 5 years. If the project cannot be completed within the 5-year development cycle, it can be extended for 2 years according to the actual development progress of the project.
In order to thoroughly implement the decision and deployment of the CPC Central Committee and the State Council on preventing and resolving the risk of implicit debt of local governments, with the approval of the State Council, Guangdong Province has decided to carry out the pilot work of no implicit debt of local governments in the whole region. On October 9, 2021, the 164th executive meeting of the 13th provincial government of Guangdong Province made arrangements, officially launched the pilot work of no implicit debt in Guangdong Province, and promoted the "clearing" of implicit debt of local governments. The urban transportation companies jointly operated by Guangdong Pearl and Xingning urban investment belong to the implicit debt of local government in terms of business cooperation, which will not be renewed after it expires in November 2021. According to the follow-up requirements of the above meeting, Guangdong Pearl needs to exit the equity of urban transportation company and terminate business cooperation before the end of 2021, and the company faces the risk that its main business is not sustainable.
（2） The risk that the company's large amount of funds are occupied by the company controlled by the actual controller
Guangdong Pearl has the situation that the enterprise health preservation mountain city controlled by the actual controller Zhang Jianli and its related parties occupy the funds of the company's subsidiaries for non operating purposes. According to the special verification report on the occupation of funds by Guangdong Mingzhu Group Co.Ltd(600382) actual controllers and their related parties issued by Lianda Certified Public Accountants (special general partnership)
Report (Lianda zhuanzi [2021] No. 2224): "As of September 30, 2021, the capital principal directly occupied by major shareholders and their related parties is 1089371043.33 yuan, the balance of interest on capital occupation is 308106060.27 yuan, and the total principal and interest is 1397477103.60 yuan; the capital principal indirectly occupied by major shareholders and their related parties is 488837149.54 yuan, and the total capital occupation is 1886314253.14 yuan." The company has the risk that large amount of funds are occupied by the company controlled by the actual controller.
（3） The company faces delisting risk
The audit report of the company in 2020 is of the type that cannot express opinions, and the delisting risk warning of the company's shares has been implemented on May 6, 2021. According to the relevant provisions of the Listing Rules of Shanghai Stock Exchange, if the audited net profit of the company in 2021 is negative and the operating income is less than 100 million yuan, or the opinion type of the company's 2021 audit report is qualified, unable to express opinions or negative opinions, the company faces delisting risk.
2、 Information on this package deal
In order to realize the healthy development of the company, resolve delisting risks and safeguard the interests of all shareholders, this transaction plan is hereby formulated. This plan includes two parts: asset sale and asset purchase: asset sale refers to the listed company's investment of 92.00% equity of urban transportation company to xingningcheng, and asset purchase refers to the purchase of Dading mining's operating asset package by Mingzhu mining, a wholly-owned subsidiary of the listed company.
(i) Reasons for this package deal
According to the requirements for the pilot work of no implicit debt in Guangdong Province, Guangdong Pearl needs to ship out the equity of the urban transportation company and terminate the business cooperation by the end of 2021. After purchasing the equity of the urban transportation company, the company will face the situation of no specific business.
As this asset disposal constitutes a major asset reorganization, according to Article 11 of the measures for the administration of major asset reorganization of listed companies, when implementing a major asset reorganization, the listed company shall fully explain that this transaction meets the following requirements, And disclose: (5) it is conducive to the listed company to enhance its sustainable operation ability, and there is no situation that may cause the main assets of the listed company to be cash or no specific business after reorganization.
As this asset disposal transaction is a necessary work for the local government to clean up the implicit debt, and the asset sale constitutes a major asset reorganization, it also needs to meet the requirements of the measures for the administration of major asset reorganization of listed companies to avoid no specific business. At the same time, the company has a large amount of funds occupied by the company controlled by the actual controller
As a result, the company's 2020 audit report was unable to express opinions, and the delisting risk warning was implemented on May 6, 2021. The placement of operating assets controlled by the actual controller into the listed company can promote the settlement of the occupation of the above funds, eliminate the situation of no specific business, and resolve the risk of delisting of the company. After analyzing all kinds of operating assets under the name of Zhang Jianli, the actual controller of the company, putting them into the operating asset package of Dading mining can eliminate no specific business, promote the solution of capital occupation and resolve the delisting risk of the company. According to Article 51 of the accounting standards for Business Enterprises No. 33 - consolidated financial statements, if the terms, conditions and economic impact of each transaction meet one or more of the following conditions, In general, multiple transactions should be accounted for as "package transactions": (1) these transactions are concluded at the same time or in consideration of mutual influence; (2) these transactions as a whole can achieve a complete business result; (3) the occurrence of one transaction depends on the occurrence of at least one other transaction; (4) A transaction is uneconomic alone, but it is economical when considered together with other transactions.
Based on the above transaction reasons, this asset disposal and asset purchase are uneconomical from a single transaction, but they are economical when considered together with other transactions; As a whole, asset disposal and asset purchase can achieve the ultimate commercial purpose of resolving the delisting risk of the company, which is in line with the characteristics of package deal. This asset disposal and asset purchase constitute a package deal.
（2） Purpose of this package deal
To sum up, this package deal completes the follow-up requirements of the pilot work of no implicit debt in Guangdong Province through asset disposal; Through the placement of assets, ensure that the listed company will not have no specific business after the placement of assets, promote the settlement of the occupation of non operating funds by the company's actual controllers and their related parties, and finally achieve the purpose of resolving the delisting risk of the company.
The company has supplemented and disclosed the following in "I. background and purpose of this transaction" in "section I overview of this transaction" of the restructuring report:
"(IV) information on this package deal
In order to realize the healthy development of the company, resolve delisting risks and safeguard the interests of all shareholders, this transaction plan is hereby formulated. This plan includes two parts: asset sale and asset purchase: asset sale refers to the listed company's investment of 92.00% equity of urban transportation company to xingningcheng, and asset purchase refers to the purchase of Dading mining's operating asset package by Mingzhu mining, a wholly-owned subsidiary of the listed company.
According to the requirements for the pilot work of no implicit debt in Guangdong Province, Guangdong Pearl needs to ship out the equity of the urban transportation company and terminate the business cooperation by the end of 2021. After purchasing the equity of the urban transportation company, the company will face the situation of no specific business.
As this asset disposal constitutes a major asset reorganization, according to Article 11 of the measures for the administration of major asset reorganization of listed companies, when implementing a major asset reorganization, the listed company shall fully explain that this transaction meets the following requirements and disclose it: it is conducive to the listed company to enhance its ability of sustainable operation, There is no situation that may cause the main assets of the listed company to be cash or no specific business after the reorganization.
As this asset disposal transaction is a necessary work for the local government to clean up the implicit debt, and the asset sale constitutes a major asset reorganization, it also needs to meet the requirements of the measures for the administration of major asset reorganization of listed companies to avoid no specific business. At the same time, the company's large amount of funds were occupied by the company controlled by the actual controller, resulting in the company's 2020 audit report being unable to express opinions, and the delisting risk warning was implemented on May 6, 2021. The placement of operating assets controlled by the actual controller into the listed company can promote the settlement of the occupation of the above funds, eliminate the situation of no specific business, and resolve the risk of delisting of the company. After analyzing all kinds of operating assets under the name of Zhang Jianli, the actual controller of the company, putting them into the operating asset package of Dading mining can eliminate no specific business, promote the solution of capital occupation and resolve the delisting risk of the company.
According to Article 51 of the accounting standards for Business Enterprises No. 33 - consolidated financial statements, if the terms, conditions and economic impact of each transaction meet one or more of the following conditions, In general, multiple transactions should be accounted for as "package transactions": (1) these transactions are concluded at the same time or in consideration of mutual influence; (2) these transactions as a whole can achieve a complete business result; (3) the occurrence of one transaction depends on the occurrence of at least one other transaction; (4) A transaction is uneconomic alone, but it is economical when considered together with other transactions.
Based on the above transaction reasons, this asset disposal and asset purchase are uneconomical from a single transaction, but they are economical when considered together with other transactions; As a whole, asset disposal and asset purchase can achieve the ultimate commercial purpose of resolving the delisting risk of the company, which is in line with the characteristics of package deal. This asset disposal and asset purchase constitute a package deal.
2. Purpose of this package deal
To sum up, this package deal completes the follow-up requirements of the pilot work of no implicit debt in Guangdong Province through asset disposal; Through the placement of assets, ensure that the listed company will not have no specific business after the placement of assets, promote the settlement of the occupation of non operating funds by the actual controller of the company and its related parties, and finally achieve the purpose of resolving the delisting risk of the company. "
3、 Verification opinions of independent financial advisor
After verification, the independent financial adviser believes that:
The asset placement and asset placement of this transaction, as a package deal, is a transaction aimed at resolving the delisting risk of the company under the background of no implicit debt pilot work requirements in Guangdong Province, in order to solve the problem of capital occupation of the company's actual controller and its related parties, as well as the problem that the company has no specific business. The package deal is conducive to resolving the delisting risk of listed companies, solving the problem of sustainable development of the company and safeguarding the interests of all shareholders
