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Ningbo Pioneer New Materials Co., Ltd. (hereinafter referred to as Pioneer New Materials, 300163.SZ), which is being suspended for reorganization, broke the silence through a paper announcement and quickly attracted investors' attention: On the evening of June 12, Pioneer New Materials released the announcement, its Shanghai Geshi Network Technology Co., Ltd. (hereinafter referred to as Gai Shi Automobile), which was acquired in September 2015, has a short-term risk of not operating normally.
Immediately, a public opinion war detonated - Pioneer New Materials took the lead in pointing to "the former general manager of Geshi Automobile" Zhou Xiaotong, accusing him of "using the official seal to issue internal notices to prevent employees from going to work normally and leading unidentified people to prevent employees from going to work normally." On the evening of June 12th and the early morning of June 13th, the official WeChat public number of “Gagogo Geshi Culture†of Geshi Automobile has successively pushed Zhou Xiaotong’s “Report to All Staff of the Company†to explain its new products with Pioneer. The battle accused Pioneer New Materials of unilaterally removing their duties, implementing a biased malicious audit, illegally robbing the company's financial books and rumors.
As of the interface press release, the battle continues to ferment. It’s awkward and wrong, it’s like looking at flowers in the fog, it’s hard to tell. However, this is the face of the listed company's management dispute over the management of the holding subsidiaries, which is inseparable from the fact that Pioneer New Materials was too impetuous in the initial acquisition of the shares of Gasgoo and thus left its drawbacks. An analyst who focuses on mergers and acquisitions said to the interface news, "For the acquired subsidiaries, listed companies should provide support as much as possible in addition to financial and personnel rights to ensure the integration of the underlying business and the listed company. Staring at short-term performance."
Both sides fight
On the evening of June 12, Pioneer New Materials released the “Note on the Status of Holding Subsidiariesâ€, stating that “Gai Shi Automobile will not be able to operate normally in the short term, which will have a major impact on the business activities of Gasgoo.†The core information of this announcement has four points: First, Geshi Automobile had an abnormal loss in the first five months of this year, with a total loss of more than 8.7 million yuan. Second, on June 6 this year, Jessica Auto Executive Director Zong Xudong announced the exemption of Zhou Xiaotong’s general manager on the spot and appointed The former actual controller of the company, Chen Wenkai, was the general manager, and the company's auditors were sent to Geshi Automobile for audit. Third, on June 8, Zhou Xiaotong led more than 10 unidentified people to enter the company, and threatened and controlled the company. The auditors robbed the official seal, financial chapter, and financial documents being audited, and prevented the company from conducting normal audits. Fourth, on June 9, Zhou Xiaotong used the official seal to issue internal notices to prevent employees from going to work and leading unidentified people. Prevent employees from going to work normally.
The announcement of Pioneer New Materials seems to indicate the cause of the dispute: due to the abnormal loss of Gasgoo, the company exempted Zhou Xiaotong from the post and sent personnel to audit to cause conflict. However, in the "Report to All Staff of the Company", Zhou Xiaolan made a statement on the incident. The incident was caused by the failure to reach an agreement with Pioneer New Materials on the future development direction of the world, and the pioneering new material adopted one. The series of acts are all unilateral and arbitrary behaviors of Pioneer New Materials, without any discussion or consultation by shareholders, or even any notification.
In response to the news of the interface, Zhou Xiaotong not only questioned the rationality of his job resignation, but also said that Pioneer New Materials’ unilateral appointment of Chen Wenkai as the general manager was a major flaw. The main reason was the weak operating ability and huge debt. There is doubt in professional conduct and there is obvious horizontal competition.
In the "All the Staff of the Company (below)" published in the early morning of June 13, Zhou Xiaoyu said that he suffered a biased malicious audit, and the shareholder unit illegally robbed the company's financial books and was maliciously wounded. On the same day, through the official Weibo of Geshi Automobile, Zhou Xiaotong also formally responded to “why oppose the newly appointed general managerâ€, “why oppose the audit of the newly appointed general manager†and “emergency mobilize external security forces to protect employee safety†and It expresses the willingness to invest and support Gasgoing for a long time. Zhou Xiaotong responded to the interface news: "What happened to the company, the biggest responsible person is the legal person. Based on what Pioneer New Materials has done, I must consider how to protect the safety of the company and employees in the worst case."
Regarding Zhou Xiaotong’s statement, the related parties Chen Wenkai and Pioneer New Materials have not yet responded. In this regard, the interface news contact Pioneer New Material Secretary, the staff of the company refused the interview on the grounds that “the company has not responded because the matter has not ended yet.â€
The interface news combined with the public information disclosed by both parties roughly summarized the development of the incident. In fact, at some detail points, the expressions of the two sides are in conflict, which makes the truth of the incident confusing.
An industry insider who did not want to be named told the interface news, "There is such a problem in the capital market. Many companies are inaccurate in their pursuit of performance and profit. They are rushed to the acquisition of the target and even the completion of the acquisition. For example, before the merger. The due diligence is not sufficient. The M&A agreement lacks detailed regulations on company personnel arrangements, financial arrangements or specific business arrangements. This can easily lead to conflicts between the acquirer and the acquired party after the completion of the acquisition."
Dismantling mergers and acquisitions
The reason why Pioneer's new material is out of control of Geshi Automobile is that the listed company is too pursuing the performance promise of the target company when it conducts mergers and acquisitions, ignoring the rigor of the merger and the control of the target business integration.
The two details reflect the impetuousness of this merger: First, the disclosure of the information on the shareholding structure of Gasgoo is inaccurate after the completion of the equity acquisition. On the afternoon of June 13, Pioneer New Materials released a correction notice stating that “because of staff turnover Part of the equity ratio is incorrectly filled and is now corrected." The interface news found that in the equity acquisition announcement disclosed in September 2015, after the announcement of the completed acquisition, the shareholding ratio of Gasgoo's shareholder Gasgo Automotive Management Team and Shanghai Chaohao Information Technology Co., Ltd. were 20% and 20% respectively. After correction, the shareholding ratio of Gasgo Automotive Management Team and Shanghai Chaohao Information Technology Co., Ltd. were 30% and 10% respectively.
Second, after the completion of the acquisition, Pioneer New Materials did not send personnel of the listed company to supervise or participate in the management. A pioneer new material person told the media that the listed company only appointed the actual controller of the former car, Chen Wenkai, as an executive director to supervise the finance. And personnel. In addition, Pioneer New Materials did not audit Gasport in two years.
In fact, the impetuous atmosphere reflected in this merger does not stop there. The interface news found that high-price acquisition is a significant label in the acquisition of 60% equity of Gasgoo. And after the completion of the acquisition, there was an inconsistency in the disclosure of the world's 2015 net profit in different occasions.
The time goes back to September 14, 2015. It has been more than two months since the suspension of the major projects of Pioneer New Materials. On the same day, Pioneer New Materials announced a notice on the acquisition of equity by foreign investment, that is, the company’s price is 63 million yuan. 60% of the shares of the car became its controlling shareholder. According to the announcement at the time, Geshi Automotive's main business includes technology development of auto parts technology and related technologies, exhibition services, and advertisements using its own media. Pioneer New Materials believes that the acquisition of Gasgoo can help listed companies invest and expand in the automotive parts and aftermarket sectors to enhance their core competitiveness.
The equity acquisition announcement also disclosed the performance and compensation measures promised by Gasgo Automotive - the audited net profit for 2015 and 2016 will reach 6.5 million yuan and 9 million yuan respectively; if the promised performance is not achieved, the difference will be partially determined by the company. Mr. Chen Wenkai, the original major shareholder, made up the cash.
The performance of this part of the commitment is very attractive. Taking 2015 as an example, Geshi Auto's promised net profit of 6.5 million yuan can account for 20% of the actual annual net profit of the listed company in the year. However, the reality is very skinny. In the equity acquisition, the performance of Gasgoo in the first five months of 2015 has been “buriedâ€.
According to the announcement, from January to May 2015, Geshi Automobile's net profit loss was 2,170,500 yuan. In the announcement of the unfinished performance compensation disclosed by Pioneer New Materials on the evening of May 11, 2016, it disclosed that the actual net profit of Geshi Automobile in 2015 was a loss of RMB 4,600,500, and the difference from the promised performance was RMB 11.16 million. The announcement shows that this part of the compensation performance has been compensated in place on May 10, 2016, and the actual compensation amount is 112.104 million yuan (including overdue late fees).
This part of the compensation performance should not be underestimated for the performance of Pioneer New Materials in 2016. According to Pioneer New Materials' 2016 Annual Report, the company's net profit attributable to shareholders of listed companies was 67.921 million yuan, and the compensation performance amount accounted for 17% of the net profit for the year. "This is the benefit of the gambling acquisition." The above-mentioned merger analysts told the interface news, "The listed company and the target company set a gambling agreement to protect their stable income, even if the performance is not up to standard, you can get a large amount of compensation."
The interface news found that Pioneer New Materials showed strong interest in the automotive aftermarket service field in 2015. Among the three foreign investment and mergers and acquisitions that Pioneer New Materials implemented in the past year, two involved the automotive aftermarket service sector. That is, in addition to the acquisition of Geshi Automobile, on May 6 of the same year, Pioneer New Materials also spent 62.1 million yuan to increase capital of Shanghai Car Care E-Commerce Co., Ltd. (hereinafter referred to as car-free worry), and obtained 20% equity of the target company. . The legal representative of raising a car without worry is Chen Wenkai, the actual controller of Gasgoo. After the capital increase was completed, Chen Wenkai still held a 61% stake in car maintenance.
The valuation of the two equity acquisitions also highlights Pioneer's preference for automotive aftermarket services. When the capital increase is no worries, Pioneer New Materials spent 62.1 million yuan to obtain 20% of its equity. The valuation of car maintenance is as high as 311 million yuan, and as of the first quarter of 2015, the total assets of car maintenance are less than 5 million. Yuan, and the external debt exceeded 20 million yuan; when the acquisition of Geshi Automobile, Pioneer New Materials spent 63 million yuan to obtain 60% of its equity, and Geshi Automobile's valuation was 105 million yuan, and as of the end of May 2015, Geshi Automobile The total assets are 14.4945 million yuan, and the net assets are as low as 2.576 million yuan.
In this battle, whether or not Gaither Motors has lost money has become a dispute between the two sides. Pioneer New Materials pointed out in the announcement that in the first five months of this year, Geshi Automobile lost more than 8.7 million yuan. However, an insider of Gasgoo told the interface news, "The company was in good condition last year. For this reason, we have placed a week off for the New Year. This year we are in good business." However, the person did not inform the exact Revenue data, "The company's financial books have been stolen."
The interface news found that the phenomenon of the disparity in the profit data of Gasgoo was not the first time. In Pioneer New Materials' 2015 annual report, the company's net profit disclosed by the company was 221,900 yuan, and there was no loss. In the announcement of the unfinished performance compensation issued in 2016, the disclosed net profit of Geshi Automobile in 2015 was -466.605 million.
Stock price
Pioneer new materials are keen on mergers and acquisitions and foreign investment.
The interface news found that since 2014, Pioneer New Materials has been suspended every year for asset restructuring or major foreign investment. In March 2014, KRS was suspended for purchase. The transaction price was about 200 million yuan, which lasted nearly 3 months; 2015 6 In the month, the suspension of bidding participated in the acquisition of 100% shares of Australia St. Kadimon Co., Ltd., and then terminated to invest 100 million yuan to participate in the establishment of Internet property insurance company, which lasted nearly 3 months; in March 2016, the suspension of acquisition of dairy farming and the original The milk production and marketing enterprise Siming invested 100% equity and 100% equity of Vantage Trade. The transaction price was about 1.18 billion yuan, which lasted for 6 months (the matter was not approved by the CSRC). In April 2017, the suspension of major assets was planned. Reorganized, has not resumed so far.
Through continuous mergers and acquisitions, Pioneer New Materials has rid of the business risks of a single main business at the time of listing, and has built a business structure with sunlight fabrics, window coverings and sunshade products, and auto parts information services as its main products. Specifically, since its launch in 2011, Pioneer New Materials has not changed its main business is Sunshine Fabric. In 2014 and 2015, the company successively acquired the window covering and sunshade products business and auto parts information service through the acquisition of Australian curtain manufacturer KRS and Geshi Automobile.
As of the end of 2016, window coverings and sunshade products have become the first major business of Pioneer New Materials, with revenue accounting for nearly 55%. Sunshine fabrics and auto parts and information services business accounted for 40% and 5% respectively, ranking second and third.
In the last three and a half years, Pioneer New Materials has been suspended for 14 months. Some market participants pointed out that the important reason for the frequent suspension of reorganization is that after landing in the capital market, the profitability of the Sunshine fabric business started by Pioneer New Materials fluctuated greatly, and its business scale could not support the capital market's share price of listed companies. Continued speculation, so it is necessary to inject assets into listed companies through mergers and acquisitions to make a large market value.
On January 13, 2011, Pioneer New Materials first rose to A shares, and rose to 28.70 yuan per share on the first day, and the price-earnings ratio soared to 78 times. However, on the last trading day of 2011, Pioneer's new stock price closed down to 16.25 yuan / share, down 43% from the first day's share price, the day's price-earnings ratio has shrunk to 34 times.
The company's sluggish share price trend continued in 2012 and 2013. In the two years, the lowest share price of Pioneer New Materials hit 10.17 yuan / share, the highest was 21.97 yuan / share, no more than the closing price when starting. The interface news found that from 2011 to 2013, the listed company operated in a single main business model and relied solely on the sunshine fabric business to “maintain its livelihoodâ€. It is worth mentioning that in the past three years, the profitability of this business has been declining, which has led to a decline in the company's hype in the secondary market.
Through the 2011-2013 annual report of Pioneer New Materials, the interface news found that in 2012 and 2013, the gross profit of the company's sunshine fabric business showed a negative growth, the most obvious decline was in 2012, and the gross profit of this business was greatly reduced in 2011. 18%. In addition, the gross profit margin of Pioneer New Materials Sunshine Fabrics business also experienced a negative growth in the three years, down 3.19 percentage points, 7.45 percentage points and 3.30 percentage points respectively.
In the A-share market, which has always liked to tell stories and look at the subject matter, the single main listed company obviously does not meet the appetite of investors, so Pioneer New Materials embarked on the road of mergers and acquisitions. In fact, the method of raising stock price and market value through mergers and acquisitions is indeed feasible. Pioneer New Materials' share price has been boosted after the suspension of the above-mentioned suspension or foreign investment. The most typical example is that after the acquisition of dairy farming and raw milk production and sales enterprise assets in 2016 for half a year, the share price of Pioneer New Materials after the resumption of trading rose 22% in 10 trading days.
Through mergers and acquisitions, Pioneer's new assets have nearly doubled in size from the initial stage of the listing. As of the first quarter of this year, the total assets of Pioneer New Materials was approximately 1.21 billion yuan, an increase of 75% over 2011. Its annual net profit scale has also increased significantly. In 2016, the net profit of Pioneer New Materials' shareholders belonging to listed companies was 67.92 million yuan, an increase of 84% over 2011.
However, the honeymoon period is short-lived, but after the carnival, it is a chicken feather.
In the first quarter of this year, Pioneer New Materials fell into a loss. Its net profit attributable to shareholders of listed companies in the first three months was about -1.08 million yuan. This is the first time that the company has suffered a single-quarter loss since its listing. Since the recent reorganization of the resumption of trading, Pioneer New Materials' stock price has been returned to its original shape: Pioneer New Materials' current share price is 7.65 yuan / share, which is 49% lower than the October 2016 high point price.
This may be a sequel to the pioneering new materials that are keen on mergers and acquisitions.
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