Today (March 17), Chongqing Road & Bridge Co.Ltd(600106) ( Chongqing Road & Bridge Co.Ltd(600106) , SH) announced that it would invest no more than 100 million yuan (excluding management fees and other expenses) as a limited partner to jointly invest with related parties to set up a limited partnership to get involved in the semiconductor industry, and the limited partnership would directly or indirectly invest in the equity of semiconductor projects.
The related parties of this cooperation with Chongqing Road & Bridge Co.Ltd(600106) are Shanghai Linxin Investment Management Co., Ltd. (hereinafter referred to as Linxin investment) and its related parties. Linxin investment holds 100% equity of Chongqing Road & Bridge Co.Ltd(600106) second shareholder Shanghai Linjun Electronic Technology Co., Ltd. (hereinafter referred to as Shanghai Linjun). In December 2021 and January 2022, Shanghai Linjun became the new second shareholder of the listed company through two transfer agreements. The reporter of “daily economic news” noted that Linxin investment has invested in many projects in the semiconductor field.
listed companies subscribed 98.94%
The partnership to be established this time is Jiaxing Linlan equity investment partnership (limited partnership) (hereinafter referred to as the partnership), with a total subscribed capital of 103.7 million yuan, of which Chongqing Road & Bridge Co.Ltd(600106) as a limited partner subscribed capital of 102.6 million yuan (including 3.6608 million yuan of management fees and other expenses), accounting for 98.94%; Linxin investment, as a general partner, subscribed 100000 yuan, accounting for 0.10%; Hainan qingyuanxin investment partnership (limited partnership), a related party of Shanghai Linjun, subscribed 1 million yuan as a special limited partner, accounting for 0.96%.
The purpose of the partnership is to realize the capital appreciation of the partnership through direct or indirect investment in the equity of semiconductor projects and create a satisfactory return on investment for partners.
However, Chongqing Road & Bridge Co.Ltd(600106) also said that the direction of the partnership’s proposed investment is the semiconductor industry. In the process of investment, it is not excluded that it will be affected by national policies, economic environment, industry cycle and competition, technological development, operation and management, human resources and other factors, and there may be a risk of failure to achieve the expected income.
For Chongqing Road & Bridge Co.Ltd(600106) , investing in the semiconductor industry is a new attempt, but Linxin investment has invested in many projects in this field. The reporter saw on the official website of Linxin investment that the company calls itself an “industrial investment platform focusing on integrated circuits”, and the invested projects include chip or semiconductor equipment enterprises such as Montage Technology Co.Ltd(688008) ( Montage Technology Co.Ltd(688008) , SH), Advanced Micro-Fabrication Equipment Inc.China(688012) ( Advanced Micro-Fabrication Equipment Inc.China(688012) , SH).
It is worth noting that Shanghai Linjun currently holds Chongqing Road & Bridge Co.Ltd(600106) 126% of the shares, which is only 2.36 percentage points away from the 14.96% shareholding ratio of Chongqing International Trust Co., Ltd., the largest shareholder. In January 2022, Shanghai Linjun said in the simplified equity change report (after the adjustment of the trading scheme) that it plans to continue to increase its holdings of shares of Listed Companies in the next 12 months and will fulfill its information disclosure obligations in accordance with relevant laws and regulations.
business is concentrated in the road and Bridge Industry
Chongqing Road & Bridge Co.Ltd(600106) said that listed companies set up partnerships to get involved in the semiconductor industry in order to diversify, seek new development opportunities and disperse the risk of companies focusing too much on road and Bridge toll construction projects. In 2020, the operating revenue of the company’s road and bridge industry was 198 million yuan, accounting for more than 98% of the revenue.
Road and Bridge toll collection business is the traditional main business of Chongqing Road & Bridge Co.Ltd(600106) the company owns the franchise rights of several bridges in Chongqing, but the road and Bridge assets have been shrinking. As of December 31, 2020, Nanshan highway in the road and Bridge assets of the listed company has been transferred, and the toll right of Niujiaotuo bridge on Jialing River and Shibanpo Yangtze River Bridge have expired.
According to the 2021 semi annual report, Chongqing Road & Bridge Co.Ltd(600106) currently still has the charging right of Shimen Bridge and Jiahua bridge on Jialing River, and also holds 33% equity of Yufu expressway company. However, the charging period of Shimen Jialing River Bridge is December 31, 2021, which will shrink the company’s assets.
In this regard, Chongqing Road & Bridge Co.Ltd(600106) said that the company will adhere to the business strategy of focusing on infrastructure project management and supplemented by project contracting, and intervene in other industries in due time.
In fact, Chongqing Road & Bridge Co.Ltd(600106) has tried to layout other industries for many years. As early as 2015, the company had planned to acquire 9 photovoltaic power generation projects to realize the dual main business pattern of “road and Bridge + photovoltaic”, but then gave up the acquisition. Since then, Chongqing Road & Bridge Co.Ltd(600106) has also been involved in shale gas, wind Cecep Solar Energy Co.Ltd(000591) power generation and other industries through equity participation, and indirectly participated in tourism real estate financing through trust financing, but they have failed to form sustainable business. At present, the concentration of business has not changed.
