Securities code: 600679 900916 stock abbreviation: Shanghai Phoenix Enterprise (Group) Co.Ltd(600679) Phoenix B share No.: 2022-008 Shanghai Phoenix Enterprise (Group) Co.Ltd(600679) enterprise (Group) Co., Ltd
Shanghai Phoenix Enterprise (Group) Co.Ltd(600679) about the acquisition of Tianjin Tianren, a wholly-owned subsidiary
Announcement of Tianjin Hongyu bicycle related asset group
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:
Shanghai Phoenix Enterprise (Group) Co.Ltd(600679) enterprise (Group) Co., Ltd. plans to acquire the asset group related to bicycle production of Tianjin Hongyu Bicycle Co., Ltd. with RMB 84.25007 million (including tax).
This transaction does not constitute a connected transaction, nor does it constitute a major asset reorganization as stipulated in the administrative measures for major asset reorganization of listed companies.
There are no major legal obstacles to the implementation of the transaction
The appraisal results of the subject assets of this transaction need to be filed and approved by Shanghai Jinshan state owned assets supervision and Administration Commission. This transaction still needs to be approved by the state-owned assets supervision and administration department.
1、 Overview of this transaction
In order to further improve the operation level of Shanghai Phoenix Enterprise (Group) Co.Ltd(600679) enterprise (Group) Co., Ltd. (hereinafter referred to as the company) bicycle industry, expand and strengthen the main bicycle industry and improve the layout of the company’s Tianjin production base. Tianjin Tianren vehicle materials Co., Ltd. (hereinafter referred to as Tianjin Tianren), a wholly-owned subsidiary of the company, plans to acquire the asset group related to bicycle production of Tianjin Hongyu Bicycle Co., Ltd. (hereinafter referred to as Tianjin Hongyu) for RMB 84.2507 million (including tax) (hereinafter referred to as this transaction). The asset group related to bicycle production refers to the asset group specified in the asset appraisal report on bicycle production related asset group of Tianjin Hongyu Bicycle Co., Ltd. involved in the proposed asset acquisition of Tianjin Tianren vehicle materials Co., Ltd. (HCRP Zi (2021) No. 2077) issued by Shanghai Cairui Appraisal Co., Ltd (including but not limited to: machinery and equipment, electronic equipment, environmental protection equipment, construction in progress and other fixed assets related to bicycle production, as well as intangible assets such as painting process and customer relationship, hereinafter referred to as the transaction object).
The capital source of this transaction is the company’s own funds.
This transaction does not constitute a connected transaction, nor does it constitute a major asset reorganization as stipulated in the administrative measures for major asset reorganization of listed companies.
This transaction does not need to be submitted to the general meeting of shareholders for deliberation.
The appraisal results of the subject assets of this transaction need to be filed and approved by Shanghai Jinshan state owned assets supervision and Administration Commission. This transaction still needs to be approved by the state-owned assets supervision and administration department.
2、 Basic information of transaction parties
(I) seller
Name: Tianjin Hongyu Bicycle Co., Ltd
Address: No. 169, Shunda street, Dagang Economic Development Zone, Tianjin, Binhai New Area, Tianjin
Type: limited liability company (sole proprietorship of legal person)
Legal representative: Liu Hong
Registered capital: 50 million yuan
Date of establishment: February 14, 2017
Business scope: general items: Bicycle Manufacturing: off highway leisure vehicle and spare parts manufacturing; Toy manufacturing; Moped manufacturing. (except for the items that must be approved according to law, the company shall independently carry out business activities according to law with its business license)
Business term: February 14, 2017 to long term
(II) buyer
Name: Tianjin Tianren Vehicle Material Co., Ltd
Address: No. 169, Shunda street, Dagang Economic Development Zone, Tianjin, Binhai New Area, Tianjin
Type: limited liability company (sole proprietorship of legal person)
Legal representative: Lin Minghua
Registered capital: 73.8 million yuan
Date of establishment: March 20, 2003
Business scope: general items: moped manufacturing; Bicycle manufacturing; Toy manufacturing; Non residential real estate leasing; Machinery and equipment leasing; Manufacturing of off highway leisure vehicles and spare parts. (except for the items that must be approved according to law, the company shall independently carry out business activities according to law with its business license)
Business term: March 20, 2003 to March 19, 2053
Tianjin Tianren Vehicle Material Co., Ltd. is a wholly-owned subsidiary of the company.
3、 Basic information of the underlying assets
(I) overview of underlying assets
The subject of this transaction is the asset group related to bicycle production held by Tianjin Hongyu, that is, the asset group specified in the asset evaluation report on bicycle production related asset group of Tianjin Hongyu Bicycle Co., Ltd. involved in the proposed asset acquisition of Tianjin Tianren vehicle materials Co., Ltd. (Hu Cai Rui Ping Bao Zi (2021) No. 2077) issued by Shanghai Cairui evaluation Co., Ltd. Including but not limited to: machinery and equipment, electronic equipment, environmental protection equipment, construction in progress and other fixed assets related to bicycle production, as well as intangible assets such as coating process and customer relationship.
(II) ownership of the underlying assets
The owner of the underlying assets of this transaction has the full right to dispose of the underlying assets, and there are no fixed assets, inventories, equity and other assets owned by a third party within the scope of the underlying assets.
(III) appraisal results of the subject assets
1. Evaluation of the underlying assets
Appraisal object and scope: the appraisal object is the asset group related to bicycle production of Tianjin Hongyu Bicycle Co., Ltd. the appraisal scope includes the fixed assets – equipment and construction in progress owned by Tianjin Hongyu, as well as the intangible assets related to equipment – coating process and intangible assets – customer relationship.
Value type: market value
Benchmark date: October 31, 2021
Appraisal method: the asset-based method and income method are adopted, and the asset-based method is selected as the appraisal conclusion.
Appraisal conclusion: according to the appraisal, the book value of the asset group related to bicycle production of Tianjin Hongyu Bicycle Co., Ltd. on the benchmark date is 47807922.50 yuan (excluding tax), the appraisal value is 75798285.31 yuan (excluding tax), and the appraisal value is in words: seventy-five million seven hundred and ninety-eight thousand two hundred and eighty-five yuan and thirty-one cents.
2. Explanation of the rationality of the appraisal of the subject assets
Considering that the property rights of assets in the asset group are clear and the financial data are complete, all assets can be identified. The quantity of the assets entrusted for appraisal can not only be determined according to the financial data and purchase and construction data, but also be verified through on-site investigation, and its value can be judged according to the way of re acquisition of the assets. Therefore, the asset-based method can be adopted for this appraisal.
3. Filing of the appraisal results of the subject assets
According to the regulations on the supervision of state-owned assets, the appraisal results of the subject assets need to be filed and approved by Shanghai Jinshan state owned assets supervision and Administration Commission.
4、 Main contents of the transaction agreement
Buyer (transferee): Tianjin Tianren Vehicle Material Co., Ltd
Seller (transferor): Tianjin Hongyu Bicycle Co., Ltd
1. Scope of assets acquired
According to the asset group sold and transferred by the seller, It refers to the asset group within the appraisal scope specified in the asset appraisal report on bicycle production related asset group of Tianjin Hongyu Bicycle Co., Ltd. involved in the proposed asset acquisition of Tianjin Tianren vehicle materials Co., Ltd. (Hu Cai Rui Ping Bao Zi (2021) No. 2077) issued by Shanghai Cairui Asset Appraisal Co., Ltd.
Including but not limited to:
(1) Machinery, equipment and other fixed assets, including but not limited to: production equipment, environmental protection equipment, transportation equipment, it equipment, fixed devices, projects under construction and other supporting facilities;
(2) The target customers’ businesses involved in this agreement include the design, manufacturing and sales of complete bicycles and parts, scooters, children’s riding pulley toys and other businesses carried out by the seller with the target customers, which the Seller agrees to transfer to the buyer;
(3) Asset use documents, including but not limited to equipment operation manual, quality certificate, warranty card and other documents and materials required for the use of assets;
(4) Spare parts, consumables and other asset related parts of assets;
(5) Technology, trade secrets, confidential information, patents, computer software, technical information and data necessary for the operation, use, management and maintenance of the asset group;
(6) Relevant data of construction in progress, including but not limited to: 1) procurement agreement, construction agreement and other contract documents related to construction in progress; 2) Construction approval, permit, filing and other documents of construction in progress (including but not limited to project approval or filing, project planning permit, project construction permit, environmental protection related documents, fire control related documents, etc.); 3) Payment vouchers for construction in progress, raw material procurement and other project related funds; 4) Other documents, data, technology and information involved in the process of project construction;
(7) All other equipment, documents, data, technology and information required for the operation, use, management, maintenance and maintenance of the asset group;
2. Purchase price and payment arrangement
(1) Underlying asset price
Both parties agree and confirm that the tentative price of this transaction is RMB 75.7982 million (excluding tax), and the price including tax is RMB 84.25007 million. Finally, based on the evaluation results of the evaluation report issued by Shanghai Cairui asset evaluation Co., Ltd. and filed by the state-owned assets supervision and administration department, the final transaction price shall be determined by both parties through negotiation, but not higher than the evaluation price through filing.
(2) Payment arrangement
First installment: 85% of the total purchase price. Specific payment time: the buyer shall pay to the seller by bank transfer within [5] working days from the date when the assets are handed over and the buyer receives the special VAT invoice of the corresponding amount of the first payment issued by the seller.
The second installment: 10% of the total purchase price. Specific payment time: the buyer shall pay the seller by bank transfer before December 31, 2022 and after receiving the special VAT invoice of the corresponding amount of the second payment issued by the seller.
The third installment: 5% of the total purchase price. Specific payment time: the buyer shall pay to the seller by bank transfer before December 31, 2023 and after receiving the special VAT invoice of the corresponding amount of the third payment issued by the seller.
5、 The impact of the transaction assets on the company
1. Improve the company’s production capacity of baby carriages
The asset group related to the production of Tianjin Hongyu bicycle acquired this time has mature production technology and meets the standards and requirements of developed countries for children’s bicycles. After the completion of this transaction, the company will have the ability to produce multi category baby carriages, which can improve the product grade of Phoenix baby carriages, enrich the product line of baby carriages, and better promote the development of Phoenix baby carriages to medium and high-end.
2. Improve the layout of Tianjin bicycle manufacturing base
This transaction will enable Tianjin Tianren to quickly form an excellent bicycle production capacity and greatly reduce the running in costs and risks of equipment and personnel brought by the self built base. It is of positive significance for the company to improve the layout of Tianjin bicycle production base and form a pattern of coordinated development of North and South bicycle bases.
3. Improve overall profitability and core competitiveness
This transaction will promote the further integration of the company’s supply chain, reduce procurement costs and management costs through large-scale, which is of positive significance for the company to further improve the supply chain, reduce costs and increase efficiency, and then improve the core competitiveness and overall profitability of the company’s bicycle industry.
6、 Risks in this transaction
After the completion of this transaction, it will face the following risks:
1. Market risk
This transaction acquired the original customer relationship of Tianjin Hongyu. If its own management ability and product quality decline, there is a risk that it will be unable to undertake relevant customer orders in the later stage. At the same time, due to the increasing uncertainty of the current international geo financial environment and the covid-19 pandemic, there is uncertainty in international trade in the future. The company will take a number of measures. First, make use of the company’s talent reserve and industry influence, actively introduce high-end talents in the industry, build a management team and continuously improve the management level. Second, strengthen communication and docking with customers to strive for the sustainability of orders. Third, vigorously explore other international markets such as Europe, Japan, Southeast Asia and the Middle East, and effectively share the uncertain risks of international trade.
2. Exchange rate risk
Under the current international situation, the fluctuation of RMB exchange rate continues to increase, which will have a certain impact on product prices and profitability.
The company will pay close attention to the development of the international foreign exchange market and improve the prediction ability of the foreign exchange market with the help of external forces. At the same time, according to the needs of business development, the company will lock in the profit space by changing the quotation method and payment terms. At the same time, it will also hedge the risk of exchange rate fluctuation by means of purchase hedging.
3. Operational risk
The company’s capital for this transaction comes from its own funds. The benefits generated after the acquisition will depend on the operation and profitability of the above asset groups related to bicycle production. To a certain extent, there is a risk that the investment will not meet the expectations. The company will strengthen the management of the asset group, give full play to the company’s bicycle professional management ability and improve the management efficiency of relevant asset groups. At the same time, the company will actively give play to the synergy of the company’s bicycle industry, integrate order resources, turn some OEM orders originally outsourced into internal production, and improve the utilization rate of production capacity, So as to improve the operation level and profitability of relevant asset groups.
In view of the above risks in this transaction, and the evaluation results of the underlying assets of this transaction still need to be filed and approved by Shanghai Jinshan state owned assets supervision and Administration Commission. This transaction can only be implemented after being approved by the state owned assets supervision and administration department. There are uncertainties about whether it can be approved and when it will be finally approved. Please pay attention to the follow-up announcement of the company and pay attention to the investment risk. The company will timely perform the obligation of information disclosure in strict accordance with the requirements of relevant laws and regulations.
It is hereby announced.
Board of directors of Shanghai Phoenix Enterprise (Group) Co.Ltd(600679) enterprise (Group) Co., Ltd. January 26, 2022
