"The company's largest shareholder and legal representative Cui Jun has been investigated by the public security organs for suspected embezzlement, and now he has been wanted nationwide. Former senior executive Wang Min has also been fired by the company." On April 22, in an announcement stamped with the official seal of Shanghai Baoyin Chuangying Investment Management Co., Ltd. (hereinafter referred to as Baoyin Investment), Baoyin Investment disclosed to its investors the investigation of Cui Jun, the company's largest shareholder and legal representative.
announcement shows that Cheng Jian, the second largest shareholder and supervisor of Baoyin Investment, will perform his duties in accordance with the relevant provisions of the Company Law and the Company Articles of Association, and assist the public security organs in carrying out the procedures for holding other persons involved in the case.
, and another announcement from Cui Jun tells a completely opposite version. What is confusing is that this announcement also stamped the official seal of Baoyin Investment Company.
Announcement from Cui Jun said, "The company's dismissal personnel Cheng Jian privately forged the signature of the legal person, forged the seal engraving certificate, forged and carved the official seal, legal person seal, and financial seal of Shanghai Baoyin Chuangying Investment Management Co., Ltd., and used the forged seal to change the backend password of the company's private equity fund in the fund industry, attempting to use the forged official seal to defraud the company's property and fund property. Cheng Jian has violated the criminal law and colluded with the dismissal of employee Wang Liping to steal it. The company's website backend password and website source code, and false announcements are issued on the website with forged official seals. Our company will hold the two of them criminally responsible in accordance with the law. "
The major shareholder was announced by the second shareholder that he had been wanted nationwide, and the second shareholder was fired by the major shareholder, and accused him of privately engraving the official seal. This private equity fund that once glorious, once won the private equity championship, and raising a lot of merchandise Xinhua Department Store (600785) has taken over. What happened?
Rashomon is becoming more and more intense, and the two major shareholders are distracted. It is worth noting that as early as January 3 this year, Baoyin Investment issued an announcement claiming that "Cheng Jian maliciously robbed the company's property in order to repay the funds of the fund customers and wanted to steal the funds of the fund to repay him personal debts. The company firmly refused and will hold Cheng Jian accountable for all legal responsibilities in accordance with the law. Cheng Jian has now officially removed all positions." The court information shows that Cheng Jian's 40.95% equity in Baoyin Investment was frozen by the Xuhui District Court of Shanghai on May 14, 2018, with a term of 3 years.
At that time, Baoyin Chuangying's announcement showed that the reason why Cheng Jian's equity was frozen was because another private equity fund it founded, Shenzhen Qianhai Yinghua Fund Management Partnership (Limited Partnership) (hereinafter referred to as Yinghua Fund), raised more than 80 million yuan of shareholders' funds. Cheng Jian, as the executive partner, failed to invest, losing 95% of the 60 million yuan of shareholders of Shenzhen Qianhai Yinghua. To this end, Shenzhen Qianhai Yinghua shareholders have applied to the court to freeze 40.95% of the equity of Baoyin Investment held by Cheng Jian. Cheng Jian agreed to the court's mediation document , and owed Shenzhen Qianhai Yinghua shareholders 2 in the mediation document.
As the second largest shareholder of Baoyin Investment, Cheng Jian then founded Shenzhen Qianhai Yinghua Fund. The major shareholder Cui Jun also seems to be in Cao's camp and is in love with him. He also founded another private equity fund, Shanghai Zhaoying Equity Investment Fund Management Co., Ltd. (hereinafter referred to as Zhaoying Investment), and Zhaoying Investment has become an affiliate of Baoyin Investment.
According to the report of China Business News (Blog, Weibo), Cheng Jian's team told the media: "Cui Jun privately registered and controlled Shanghai Zhaoying Asset Management Co., Ltd., and input Baoyin Chuangying's funds into the company. The funds were raised through Baoyin Chuangying, and the agency sales expenses were paid by Baoyin Chuangying, but the funds flowed to Shanghai Zhaoying. Cui Jun is the fund manager of Baoyin Chuangying, and Wang Min is the risk control director. The two colluded to sign the fund investment agreement. After the custodian saw the agreement, they transferred 90 million yuan of funds into Zhaoying Assets. Cui Jun can freely allocate funds. At the same time, there are also large and suspicious consultation fee expenditures in the future."
reporter verified the matter with Cui Jun's team on this matter, but as of press time, Cui Jian's mobile phone number has been shut down. In addition, the reporter also called the person who called the police from Cui Jun’s team of Baoyin Investment, but no one answered the phone.
"Barbaric" who raised the bid for Xinhua Department Store
Baoyin Investment's most Buffett potential 1 private equity fund managed by Cui Jun's team. In 2014, it once won the title of private equity championship, which attracted attention in the industry. Since then, Cui Jun has taken a more high-profile step. In February 2015, Baoyin Investment’s private equity fund began to invest in Xinhua Department Store. In April 2015, Baoyin Investment completed its first raising of Xinhua Department Store, and continued to increase its holdings within the next 10 trading days until the shareholding ratio of its funds increased to 10%.
But since then, Xinhua Department Store issued an announcement to make a private placement. However, the behavior of the private placement did not help the former major shareholder Wumei Holdings settle the position of the largest shareholder. Baoyin Investment then increased its shareholding ratio to 32% through continuous increase in holdings and raising shares, replacing the position of Wumei Holdings as the largest shareholder.
In 2016, Baoyin Investment was sued by Xinhua Department Store. Xinhua Department Store said it had serious market breach of trust, illegally increasing holdings, reducing holdings, and illegally manipulating stock prices. After more than a year of tug-of-war, in October 2017, the court rejected the lawsuit request of the former Xinhua Department Store, and the equity of Baoyin Investment was confirmed.
During the lawsuit, Baoyin Investment's shares in Xinhua Department Store were frozen, and some of its funds also announced that investors would suspend redemption. Announcement provided by Xinhua Department Store shows that Baoyin Investment and its joint actor Zhaoying Investment have a total of 60.88 million shares in four fund accounts have been frozen. At the same time, Xinhua Department Store also emphasized that except for the four fund accounts listed in the table, no other fund accounts under Shanghai Baoyin and Shanghai Zhaoying held shares and were frozen.
However, it is interesting to note that there are only 3 private equity funds under Baoyin Investment’s name that involve the freezing of shares, but during the same period, 21 funds under Baoyin Investment’s suspension of redemption. In Baoyin Investment’s announcement, the company said that the suspension of redemption of these funds was due to “directly or indirectly investing in shares of Yinchuan Xinhua Department Store Commercial Group Co., Ltd.,” but it is unknown how the remaining 18 funds can indirectly hold Xinhua Department Store and indirectly hold how many shares they have.
However, just as the Xinhua Department Store held by Baoyin Investment was lifted and the redemption of its products was opened, its fund funds showed large-scale performance changes. From April 27, 2018 to August 31, 2018, most of the funds that suspended redemption suddenly changed their net value. One of them, Shanghai Baoyin Chuangying, the most Buffett-potent hedge fund, fell from 1.0226 yuan to 0.2373 yuan. In the explanation given by Baoyin Investment to investors, it was mentioned that this was caused by the decline in Xinhua Department Store's stock price during the period when the shares were frozen. However, judging from the stock price of Xinhua Department Store, the cumulative decline in the four-month period was only 16.37%, which is difficult to explain where the losses exceeding 80% of the fund assets are caused.
In addition, Baoyin Investment has been questioned since it launched a bid for Xinhua Department Store. On February 14, 2018, Cui Jun proposed three additional temporary proposals to Xinhua Department Store's 2017 shareholders' meeting, including a proposal to pay a cash dividend of 44.5 yuan per 10 shares in 2017, involving nearly 1 billion yuan. The 2017 annual report shows that Xinhua Department Store's net profit attributable to its parent company shareholders was only 1.07 billion yuan. Cui Jun's proposal was eventually rejected by the board of directors of Xinhua Department Store on the grounds that "if the company's actual cash flow tolerance is rashly implemented with a huge cash dividend of nearly 1 billion yuan, it will cause the company to be in a dangerous situation of breaking its capital chain and will have a significant adverse impact on the company's development."
Before this, Cui Jun's proposal to enter the Xinhua Department Store's board of directors was rejected.
However, according to the first quarter report of 2019 released by Xinhua Department Store a few days ago, Baoyin Investment still has two funds ranked among the top ten shareholders, and the two funds hold a total of 30.84% of the shares.
This article is from Blue Whale Finance
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