【Securities Times 】Investing RMB 1.6 billion in SiErTe, Yuan Qihong returned to the A-share market

After quitting from Tongling Trinity Technology Co., Ltd. (stock code: 600520) for six months, Yuan Qihong, Chairman of Goocoo Investment Group, returned to the A-share market through transferring controlling stake. Anhui SiErTe Fertilizer Industry Co., Ltd. (stock code: 002538) announced in the evening of October 23 that its controlling shareholder, Ningguo Agricultural Materials Company, had transferred 179.53 million tradable indefinitely-sold shares of SiErTe to Goocoo Industrial Holdings Co., Ltd. (hereinafter referred to as “Industrial Holdings”), Goocoo Investment Group, by means the transfer agreement, accounting for 25% of SiErTe equity.

Announcement shows that the price of underlying transferred shares is RMB 8.8 yuan/share, amounting to RMB 1.58 billion yuan. After the change of shareholding, the controlling shareholder of SiErTe is changed from Ningguo Agricultural Materials Company to Goocoo Industrial Holdings Co., Ltd., and its actual controller is changed from Jin Guoqing to Yuan Qihong.

The former actual controller of Tongling Trinity Technology Co., Ltd. took it over

According to the announcement, SiErTe equity held by Ningguo Agricultural Materials Company and Jin Guoqing, persons acting in concert, was 38.29% before transfer, and falls to 13.29% after transfer, and Ningguo Agricultural Materials Company becomes the second largest shareholder of SiErTe.

In terms of the offeree, Yuan Qihong, directly holds 99.60% of Goocoo Investment Group’s equity, and indirectly holds 90% of Industrial Holdings’ equity through Goocoo Investment Group, directly holds 10% of Industrial Holdings’ equity at the same time. After Industrial Holdings holds 25% of SiErTe’s equity, therefore, Yuan Qihong has become the actual controller of SiErTe.

In the arrangement of equity delivery, Goocoo Industrial Holdings will pay RMB 1.58 billion yuan of share transfer in cash to Ningguo Agricultural Materials Company by three installments, and should pay RMB 1.08 billion yuan of the second share transfer before November 30, 2016. Both parties have agreed to go through share transfer registration formalities within three working days after receipt of payment of the second share transfer.

Yuan Qihong and Goocoo Investment Group pay more than RMB 1 billion yuan in cash, showing they have extraordinary strength. According to the announcement, Goocoo Industrial Holdings, founded in April 2014, holds 49% of equity of Goocoo Robot and Goocoo International Trade, but has not paid it yet. Yuan Qihong and other major enterprises controlled by Goocoo Investment Group involve in real estate development, modern logistics, mining and other fields.

In reality, Yuan Qihong is so familiar with the capital market. Goocoo Robot transferred controlling stake of Tongling Trinity Technology Co., Ltd. with RMB 130 million yuan in June 2015, and launched private placement of plan transformation robotics and other fields in April, 2016. But by the end of June, 2016, Yuan Qihong controlling Tongling Trinity Technology Co., Ltd. just for one year withdrew capital suddenly, and transferred controlling stake to Anhui Ruizhen Business Management Company.

Goocoo Investment Group has more investment in the bond market. The reporter from egs.stcn.com queries and finds out that CSRC (China Securities Regulatory Commission) approved Goocoo Investment Group to publically issue corporate bonds with the total face value not more than RMB 2 billion yuan to qualified investors in December, 2015. Currently, Goocoo Investment Group has been completed issuance of RMB 2 billion bonds.

According to the official website of Goocoo Investment Group, the total assets of Goocoo Investment Group was more than RMB 37.8 billion yuan in 2015, achieved annual revenue of RMB 18.5 billion yuan,  and ranked Top 50 China’s Real Estate Development Enterprises and in the second place of Top 100 Private Enterprises in Anhui Province.

Optimization of the Corporate Business Structure

After the acquisition, in the arrangement of the listed companies, “At present, we have no major adjustment plan for its staff, business, organizational structure and so on, based on the needs of the actual operation, however, we don’t exclude the possibility of making appropriate and necessary adjustments of its board of directors, board of supervisors, senior executives, and business and organizational structure, in line with the principle of making listed companies bigger and stronger in two major businesses, i.e. phosphoric compound fertilizer and massive health, in accordance with the law and regulations within the next 12 months, in order to maintenance listed companies and all the shareholders.” said the new controlling shareholder of SiErTe.

In his plain remarks, “the principle of making listed companies bigger and stronger in two major businesses, i.e. phosphoric compound fertilizer and massive health” is worth attention. Data show that SiErTe specializing in compound fertilizer is running well in recent years, with the revenue of RMB 1.392 billion yuan and profits of RMB 135 million yuan in the first half of 2016. In May this year, SiErTe and Great Wall (Tianjin) Equity Investment Fund Management Co., Ltd. co-founded the health care industry fund, amounting to RMB 350 million yuan, aiming to “establish a new situation that compound fertilizer industry and medical health industry develop hand in hand”.

This coincides with the objective of Goocoo Investment Group starting from real estate, but transforming repeatedly in recent years. In 2016, according to the official website of Goocoo Investment Group, Goocoo Investment Group strategically accesses to the health care industry, cooperates with Anhui Women and Child Health Care Hospital to construct the project of “South Hospital Area of Anhui Women and Child Health Care Hospital”, and plans to participate in the green nursing homes and other social programs.

With the steady development of comprehensive real estate business, Goocoo Investment Group is actively devoting itself to intelligent manufacturing, has determined its transition to intelligent high-tech industry, high-end equipment manufacturing industry, new energy conservation and environmental protection materials, new energy industry and other strategic emerging industries. In addition to establishing the robotics research center and the robotics industrial park with the University of Science and Technology of China, Goocoo Investment Group acquired Sichuan Haote Electric and becomes its controlling shareholder, and officially enters the field of industrial robot in 2016.