Securities code: Tianyu Eco-Environment Co.Ltd(603717) securities abbreviation: Tianyu Eco-Environment Co.Ltd(603717) Announcement No.: 2022015
Tianyu Eco-Environment Co.Ltd(603717)
Announcement on partial reply to the inquiry letter of Shanghai Stock Exchange
The board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear individual and joint liabilities for the authenticity, accuracy and completeness of its contents.
Important content tips:
(1) The audit and evaluation procedures of this transaction have not been completed yet: this transaction still needs to complete the audit and evaluation procedures of the target company, and sign the equity investment agreement to complete the transaction after re deliberation by the board of directors of the company. It is still uncertain whether the transaction can be completed. If the appraisal results touch the major asset reorganization or the deliberation standard of the general meeting of shareholders specified in the administrative measures for major asset reorganization of listed companies, the company will perform the relevant deliberation procedures.
(2) The target company has the risk of loss: the phase I production line of the target company is in the trial production stage; The phase II production line is still under construction, and there is great uncertainty about the official production time. After the completion of this transaction, the target company may have the risk of continuous loss, which will be included in the consolidated statements of listed companies, which will have a great adverse impact on the company's net profit. (3) This transaction will generate large Goodwill: the company needs to invest 610 million yuan, and the goodwill attributable to the listed company is expected to be about 200300 million yuan. In the later stage, if the target company's profit is less than expected, the company may have a large risk of goodwill impairment. The financial interest expense in 2022 is expected to be 760624 million yuan, an increase of 180481 million yuan compared with 2020, which will further have a great adverse impact on the company's net profit.
(4) There is uncertainty in the full loan of major shareholders: the consideration of this transaction is 610 million yuan, and the main sources of funds are self owned funds, external financing and the loan of major shareholders. Part of the major shareholder's loan is used for this transaction and the repayment of corporate bonds. The major shareholder has made a written commitment to lend 500 million yuan to the listed company, but there may be a risk that the major shareholder's own funds are insufficient and the provision of large loans cannot be fully in place.
(5) The formal investment agreement has not been signed yet: because the formal equity investment agreement has not been signed, and the performance gambling terms with the original actual controller have not been improved, if the target company's later profit is less than expected, there is a risk exposure that the performance compensation obligation is lack of guarantee terms.
(6) The company has the risk of shortage of funds: the company is currently in a state of loss and the amount of interest bearing liabilities is high. At the same time, in 2022, the company is facing the capital needs of corporate bond repayment, temporary replenishment repayment of raised funds, due repayment of bank loans and daily operating expenses. The high consideration of this transaction may increase the capital burden of the company and further aggravate the capital shortage of the company.
(7) There is no business collaboration between the company and the target company: the company has no talent reserve, technology accumulation, business resources and R & D capacity in lithium battery materials, so it is temporarily unable to form business collaboration with the target company. If there is structural overcapacity in the lithium battery materials industry, enterprises that lack competitiveness in technology and scale may face reshuffle. The products of the target company are relatively single, the product price is greatly affected by market supply and demand, and the anti risk ability is weak.
(8) The restriction on the sale of the company's non-public offering shares has been lifted: the prohibition on the non-public offering shares has been lifted, and some non-public offering subscribers who still hold the company's shares and Shanghai Muxin fund products have not made clear the reduction arrangement (as of the date of the announcement of the proposed investment, three shareholders of the non-public offering subscribers no longer hold the company's shares), so there is a risk of stock price fluctuation of the company.
Tianyu Eco-Environment Co.Ltd(603717) (hereinafter referred to as "the company" or " Tianyu Eco-Environment Co.Ltd(603717) ") received the inquiry letter on Tianyu Eco-Environment Co.Ltd(603717) foreign investment matters (shgh [2022] No. 0136) (hereinafter referred to as "the inquiry letter") issued by Shanghai Stock Exchange on February 22, 2022. The board of directors of the company attached great importance to this and carefully checked the questions in the inquiry letter about the capital increase to Qinghai juzhiyuan new materials Co., Ltd. (hereinafter referred to as the "target company" or "Qinghai juzhiyuan"). The inquiry letter involves 7 questions, and the reply is 4-7 questions. Since question 1 needs the evaluation value of the target company as the basis to discuss whether it needs to be reviewed by the general meeting of shareholders, and the reply needs to be combined with the target company's pre production and main trading customers, the company's audit institution is implementing audit confirmation procedures for key factors such as the target company's pre production output, sales of trial production products and revenue recognition; In question 2, it is necessary to analyze and explain the specific reasons for the sustained losses of the target company, and the quantitative analysis can be carried out only after the financial data of the target company are confirmed through the audit procedures; The performance forecast in question 3 needs to be demonstrated and analyzed in combination with the audit and evaluation conclusions, so questions 1-3 cannot be answered temporarily.
The audit and evaluation work is to be completed before March 23, and the reply to questions 1-3 shall be announced no later than March 25. This transaction needs to be submitted to the board of directors for deliberation after evaluation and audit, which is still uncertain. The reply to questions 1-3 will be made before the meeting of the board of directors. The replies to questions 4-7 are announced as follows:
Question 4: about the source of funds. The announcement shows that the company's capital increase of 610 million yuan comes from self financing, including but not limited to its own funds and M & A loans. At the end of the third quarter of 2021, the balance of monetary funds of the company was only 258 million yuan, and at present, 198 million yuan of temporary supplementary funds have not been returned, and another 250 million yuan of bonds will expire in June 2022. The company is requested to: (1) explain the specific arrangement and feasibility of the transaction funds in combination with the company's liquidity and available financing channels; (2) Combined with the company's asset liability structure, evaluate the impact of this transaction on the company's liquidity and debt repayment pressure, and how the subsequent capital arrangement can ensure the company's production and operation needs.
[reply]
(I) explain the specific arrangement and feasibility of the transaction funds in combination with the company's liquidity and available financing channels;
1. About the company's liquidity
By the end of the half year of 2021 and the third quarter of 2021, the company's main operating assets and liquidity are as follows: unit: RMB
Project June 30, 2021 September 30, 2021
Total current assets 2338784014252231 Daqing Huake Company Limited(000985) 71
Of which:
Monetary capital 4257835974025759930955
Accounts receivable 7225172787971198910040
Contract assets 7758419996480952250896
Total current liabilities 150613984016136547092329
Total assets 347316124095333348380550
Current ratio 1.55 1.63
Quick ratio 0.98 0.84
Overdue short-term loans 0.00 0.00
According to the above table, the current ratio of the company in the first half year and the third quarter of 2021 is 1.55 and 1.63 respectively, ranging from 1.5 to 2.0. However, combined with the current business scale and the overall situation of cash flow of the company, due to the time difference in revenue and expenditure business in the daily business process, the current ratio is not high, The cash inflow from the company's daily sales collection and other operating activities cannot cover the cash outflow from operating activities temporarily, and the short-term solvency is general.
2. Source of funds of the company:
(1) Self owned funds: as of September 30, 2021, the total balance of monetary funds of listed companies with Consolidated Standards was 2575993 million yuan (including 22 million yuan of temporary supplementary flow funds of raised funds), including 2028451 million yuan of unrestricted monetary funds.
(2) Asset sales supplement the company's cash flow
In order to further revitalize the stock assets and improve the use efficiency of assets, the company signed the Shanghai real estate sales contract (hereinafter referred to as "the contract") with Shanghai Fudan Microelectronics Group Co.Ltd(688385) on January 26, 2022, Sell the house with a building area of 677227 m2 and the land use right within the occupied area of the house at No. 12 and No. 15, Lane 1688, Guoquan North Road, Yangpu District, Shanghai with a total price of 222130456 yuan (in words: two hundred and twenty-two million one hundred and thirty thousand four hundred and Fifty-six yuan) (see the announcement on the sale of assets by the company, Announcement No.: 2022004). So far, the company has received 122 million yuan, and the remaining 100 million yuan will arrive before March 15, 2022 according to the contract. Therefore, the sale of houses brings 222 million yuan of new funds.
In addition, the company will continue to dispose of some idle assets and is expected to add about 110 million yuan.
(3) Financing channels
The financing channels available to listed companies are mainly bank loans. As of September 30, 2021, the credit line obtained by the listed company is 1272 million yuan, the used credit line is 457112700 yuan, and the remaining credit line is 814887300 yuan, which is enough to support the daily business needs through bank credit. In addition to the obtained bank credit line, listed companies can also raise funds for daily operation by issuing bonds, non-public issuance of shares and other means. In 2021, the company raised 394 million yuan through non-public offering of shares (see announcement on the results of non-public development bank stock issuance and changes in share capital, Announcement No.: 2021050). All the above funds have been recorded and used for the company's daily production and operation. (4) M & A Loans: with regard to this transaction, the company has contacted a number of interested banks to plan M & A loans, and it is expected that the funds it can raise will not exceed 60% of the transaction amount, about 366 million yuan.
(5) Loans provided by other financial institutions.
(6) Borrowings from major shareholders
In 2021, the company is expected to apply to the controlling shareholders Mr. Luo Weiguo and Mr. Shi Dongwei for a total loan of no more than RMB 500 million for the company's daily operation and business development. As of the date of this announcement, the total amount of RMB 297.1 million borrowed by the company from Mr. Luo Weiguo and Mr. Shi Dongwei has been fully paid off, and the major shareholders have obtained the transfer price of RMB 3044289 million by transferring their private investment fund shares.
3. Specific arrangements for transaction funds
(1) Contribution from the company's own funds:
If the transaction is implemented, according to the transaction arrangement, the advance payment of 60 million yuan (paid) and the first phase of capital increase of 200 million yuan will be paid with the company's own funds (222 million yuan for the sale of houses and 38 million yuan for the project). As of February 28, 2022, the total balance of consolidated monetary funds (Unaudited) of listed companies was 5417171 million yuan (including 198 million yuan of temporary supplementary flow of raised funds). (2) M & a loan contribution:
The subsequent capital increase in the second phase is RMB 100 million and that in the third phase is RMB 250 million, which is planned to be funded by M & A loans.
(3) Loan guarantee of major shareholders:
During the implementation of this transaction plan, the company plans to borrow Tus-Design Group Co.Ltd(300500) million yuan from major shareholders as needed for the comprehensive capital guarantee of the whole capital increase and M & a plan. The major shareholders have promised in writing to lend 500 million yuan to the listed company, which may lead to the risk that the large amount of loans cannot be fully provided due to the insufficient self owned funds of the major shareholders.
4. Feasibility of transaction fund arrangement
According to the capital arrangement, the corporate bond of 250 million yuan will be due to repay the principal and interest on June 12, 2022, and the capital source is the loan of major shareholders; The supplementary flow of the raised funds is 198 million yuan, which will expire on September 8, 2022. The source of funds is the collection of the project funds. As of February 28, 2022, the company has received 187784500 yuan of the project funds in 2022. At present, the company's projects under construction are accelerating the construction progress and collecting the funds normally according to the construction progress, so the collection of the project funds is enough to ensure the return of the raised funds.
At the same time, the company can raise an additional fund of about 888 million yuan for the implementation of this transaction (222 million yuan for the sale of houses, 366 million yuan for M & A loans and 300 million yuan for major shareholders). If the M & a loan cannot be paid in time or the funds raised are less, the loan amount of major shareholders can be used as an additional guarantee.
In conclusion, the capital arrangement of this transaction is feasible.
(II) combination
