"Father of PHS" to report!The object is actually the former executive of the subsidiary company
Qiu Dekun Shanghai Securities News
ST Zhongjia, controlled by Wu Ying, the "father of PHS", reported the case to the police, and the target was the former executive of its wholly-owned subsidiary.
On the evening of June 9, ST Zhongjia announced that the company recently reported the case to the Chaoyang Branch of the Beijing Municipal Public Security Bureau. Suspected of misappropriation of company funds.On June 8, the public security organ placed the case on file.
On the other side of ST Zhongjia's report, because of the loss of control over Jiahua's information, its performance suffered huge losses, other risk warnings were issued, and the stock price fell continuously...
ST Zhongjia, which is controlled by Wu Ying, the "father of PHS", has any entanglement with the former executives of Jiahua Information?
A chain reaction to the loss of control of Jiahua's information
ST Zhongjia's report was a little helpless, mainly because of the chain reaction after the loss of control of Jiahua's information.
ST Zhongjia introduced that since October 1, 2021, the company has been unable to obtain the complete financial information of Jiahua Information, perform on-site audits on it, and cannot grasp the actual operation, asset status and potential risks of Jiahua Information. As a result, the company cannot control the major business decisions, personnel and assets of Jiahua Information, and the company has in fact lost control of Jiahua Information.
This led to a negative opinion on ST Zhongjia's 2021 internal control audit report.According to the relevant provisions of the "Shenzhen Stock Exchange Stock Listing Rules", the Shenzhen Stock Exchange has implemented "other risk warnings" for the company's stock trading since May 6.
The audit institution stated that ST Zhongjia lost control of Jiahua Information and decided not to include Jiahua Information in the scope of consolidation of the consolidated financial statements from October 1, 2021, which limited the audit scope of the audit institution.
ST Zhongjia lost control of Jiahua’s information, which also led to a substantial loss in its net profit attributable to its parent in 2021.
Financial data related to ST Zhongjia's 2021 annual report
Among them, ST Zhongjia, based on the principle of prudence, accrues an impairment loss of RMB 1.236 billion for the investment in Jiahua Information based on the difference between the estimated recoverable amount and the book value and is included in the current profit and loss.
At the same time, ST Zhongjia will transfer the 287 million yuan of net profit attributable to the parent, after deducting cash dividends, from the merger date of June 1, 2018 to the date of loss of control in 2021, into the investment loss of 2021.
The above two items of ST Zhongjia total 1.523 billion yuan.
Source: ST Zhongjia "Announcement on the Company's 2021 Asset Impairment Provision"
In terms of stock price reaction, ST Zhongjia experienced a continuous limit-down for the 7 trading days from May 6 to May 16.
Calamity K. Wah Information has not fulfilled its perfor mance commitment
The conflict between ST Zhongjia and Liu Yingkui and others can be traced back to ST Zhongjia's acquisition of Jiahua Information four years ago.
In November 2018, ST Zhongjia completed a major asset restructuring.According to the transaction plan, ST Zhongjia intends to issue shares and pay cash to Liu Yingkui, Jiayu Chunhua and Jiahui Qiushi respectively to purchase 100% of the shares of Jiahua Information held by them.Among them, 51% of Jiahua Information's equity was paid in cash, and the transaction price was 755 million yuan; 49% of Jiahua Information's equity was paid by issuing shares, and the transaction price was 725 million yuan.
Jiahua Information is mainly engaged in information intelligent transmission and financial service outsourcing.ST Zhongjia believes that the company's acquisition of Jiahua Information can rapidly expand the scale of the existing mobile information transmission service business and enrich the customer base.At the same time, the company will enter the field of financial service outsourcing and gain a new profit growth point.
Correspondingly, Liu Yingkui and others have made performance commitments, and the net profit of Jiahua Information from 2017 to 2020 will not be less than 102 million yuan, 134 million yuan, 167 million yuan, and 201 million yuan respectively.
Jiahua Information Performance Commitment Source: ST Zhongjia "Report on Issuing Shares and Paying Cash to Purchase Assets and Related Transactions (Revised Draft)"
After K. Wah Information completed its performance commitment from 2017 to 2019, it failed to fulfill its performance commitment in 2020 due to the impact of the epidemic.
Source: ST Zhongjia's 2020 annual report discloses the 2020 financial data of Jiahua Information
ST Zhongjia said that Jiahua Information failed to fulfill its performance commitment and triggered the performance compensation clause, and Liu Yingkui and others should bear joint and several responsibility for this.According to the "Performance Compensation Agreement", Liu Yingkui and others need to compensate 56.431 million shares of the company due to asset impairment due to the expiration of the performance commitment period, corresponding to a cash compensation amount of 618 million yuan.
However, Liu Yingkui and others did not fulfill the above requirements and instead applied for arbitration.On July 1, 2021, ST Zhongjia received the relevant materials issued by the Beijing Arbitration Commission. Liu Yingkui and others filed arbitration with the Beijing Arbitration Commission for the relevant disputes and submitted an application for property preservation.
The reason for Liu Yingkui and others to apply for arbitration is that ST Zhongjia failed to pay part of the cash consideration and provide pledge guarantees as agreed, and required ST Zhongjia to pay the corresponding equity purchase consideration, interest, liquidated damages, etc.
Application for arbitration by Liu Yingkui et al.
According to Tianyancha, the legal representative of Jiahua Information was changed to Lin Ming, president of ST Zhongjia, and the equity was changed to a wholly-owned subsidiary of ST Zhongjia.However, the arbitration between ST Zhongjia and Liu Yingkui and others has not yet come to a conclusion.
On January 12, 2022, ST Zhongjia submitted an arbitration counterclaim application and other documents to the Beijing Arbitration Commission with Liu Yingkui and others as the respondent, which was accepted on January 24, 2022.
ST Zhongjia believes that due to the arbitration dispute with the company, Liu Yingkui and others used the status of the founding shareholders of Jiahua Information to deliberately confuse the public, interfere with the normal operation of Jiahua Information, instigate the Jiahua Information Management Team to fight against the company's management, and ignore the company's status as a shareholder of Jiahua Information. 100% shareholder of China Information.The company lost control of Jiahua's information, and Liu Yingkui and others have an inescapable responsibility.
Liu Yingkui and others believed that because ST Zhongjia disrupted the production and operation of Jiahua Information, at least 793 million yuan was depreciated in the equity value of Jiahua Information, and this part of the loss should be compensated by ST Zhongjia.
