Reporter of the Economic Business: Chen Chen Reporter of the Economic Business Business: He Jianling
Picture source: Photo Network_500706634
On the evening of April 25, Pacific Securities issued an announcement stating that it received the "Auction Notice" issued by Beijing Second Intermediate People's Court forwarded by the largest shareholder Jiayu Investment. The auction target was 744 million shares of Pacific Securities held by Jiayu Investment, accounting for 10.92% of the total share capital of Pacific Securities. It is reported that because Jiayu Investment failed to repay Huachuang Securities margin, interest and other related expenses on time as required by the judgment, Huachuang Securities applied to the court for compulsory execution.
" Daily Economic News " reporter learned from the official website of Beijing Property Exchange that the 744 million shares of Pacific Securities were auctioned this time, with an appraisal price of 2.158 billion yuan and an appraisal unit price of 2.90 yuan per share; the starting price is 1.726 billion yuan and an starting unit price of 2.32 yuan per share, which is equivalent to a 20% discount on the appraisal price. On April 25, the closing price of Pacific Securities was 2.66 yuan per share.
The largest shareholder of Pacific Securities holds shares and to be auctioned
On the evening of April 25, Pacific Securities issued an announcement stating that recently, the company received the "Auction Notice" issued by the Beijing Second Intermediate People's Court forwarded by the largest shareholder Beijing Jiayu Investment Co., Ltd. (hereinafter referred to as "Jiayu Investment"), and learned that the shares of the company held by Jiayu Investment will be auctioned by judicially.
The specific auction situation is: Beijing Second Intermediate People's Court will publicly auction 744 million shares of Pacific Securities held by Jiayu Investment on the Beijing Property Exchange online judicial auction platform from 10:00 on May 26, 2022 to 10:00 on May 27, 2022 (except for delays), accounting for 10.92% of Pacific Securities' total share capital. All of the above shares have been frozen by the judicial system.
Regarding the reasons for the share auction, Pacific Securities stated that due to equity transfer disputes, Huachuang Securities filed a lawsuit with Jiayu Investment as the defendant. In October 2021, the Second Intermediate People's Court of Beijing issued the " Civil Judgment " No. (2021) Beijing 02 Minchu 288. Because Jiayu Investment failed to repay Huachuang Securities' margin, interest and other related expenses on time as required by the judgment, Huachuang Securities applied to the court for compulsory execution.
reporter learned that the court's judgment result is: 1. Jiayu Investment paid Huachuang Securities a margin of 1.5 billion yuan and interest within ten days after the judgment took effect (from November 21, 2019 to the date of payment, the unpaid part of 1.5 billion yuan is calculated at an annual interest rate of 8%. Among them, Jiayu Investment paid 50 million yuan on August 17, 2020 will be deducted from the interest). 2. Jiayu Investment will pay a liquidated damages to Huachuang Securities within ten days after the judgment takes effect (from August 15, 2020 to the date of payment, based on the unpaid part of 1.5 billion yuan, calculated at an annual interest rate of 7%); 3. Jiayu Investment will pay Huachuang Securities an lawsuit to preserve liability insurance premium loss of 1.1923 million yuan within ten days after the judgment takes effect; 4. Huachuang Securities will enjoy the priority right of to receive compensation for 581 million shares of Pacific Securities held by Jiayu Investment in the scope of Jiayu Investment as determined in items one to three of the above judgments.
equity transfer traces back to 2019
On November 15, 2019, Huachuang Yangan wholly-owned subsidiary Huachuang Securities and Jiayu Investment signed a relevant agreement. Huachuang Securities plans to acquire part of Pacific Securities' equity held by Jiayu Investment for 2.2 billion yuan. After the agreement was signed, Huachuang Securities paid a margin of 1.5 billion yuan to Jiayu Investment as agreed, and Jiayu Investment pledged the 581 million shares of Pacific Securities held to Huachuang Securities.
However, after half a year, on June 3, 2020, Huachuang Yangan announced that in view of the major changes in the transaction environment, the two sides agreed to terminate the transaction. It is worth mentioning that the specific reasons for the termination have also attracted the attention of the China Securities Regulatory Commission.In the secondary feedback on the application documents for private placement of shares in Huachuang Yangan, the China Securities Regulatory Commission pointed out: What specific matters in the trading environment in June 2020 have changed, resulting in the need of both parties to terminate the agreement? Why is the agreement terminated more than half a year after the date of signing?
In response to this, Huachuang Yangan once replied that since the outbreak of the new crown epidemic in 2020, the audit site work has been difficult, and Jiayu Investment has failed to effectively coordinate, organize and cooperate, resulting in the failure to fully carry out due diligence work and the audit procedures cannot be effectively implemented. In addition, the two parties failed to reach an agreement on the matters found for preliminary due diligence, and during the transaction, the target company experienced compliance risk incidents, and administrative supervision measures were taken by the regulatory authorities.
terminates the transaction. Jiayu Investment should return the margin and interest paid by Huachuang Securities as agreed, but Jiayu failed to fulfill the repayment obligation as scheduled as agreed in the agreement and only repays 50 million yuan.
Therefore, Huachuang Securities applied to Beijing No. 1 Intermediate People's Court to to Beijing Investment's assets for pre-trial property preservation . The court has frozen the 349 million Pacific Securities shares held by Jiayu Investment (including 163 million shares that have not yet been pledged and 186 million shares that have been pledged), that is, Huachuang Securities has pledged or frozen all the shares held by Jiayu Investment in Pacific Securities, totaling 744 million shares.
.744 billion shares valuation price of 2.158 billion
Just after Pacific Securities disclosed the aforementioned announcement, a reporter from the "Daily Economic News" found that the Beijing Property Exchange disclosed the key information of this auction in more detail - the auction price.
According to the auction announcement of on the Beijing Property Exchange, the rated price of 744 million shares of Pacific Securities held by Jiayu Investment is 2.158 billion yuan, with an appraisal unit price of 2.90 yuan per share; the starting price is 1.726 billion yuan, with an starting unit price of 2.32 yuan per share. On April 25, Pacific Securities closed at 2.66 yuan per share.
Image source: Beijing Property Exchange website
It is reported that the value of this Pacific Securities market is the average closing price from March 24, 2022 to April 22, 2022, multiplied by stocks (744 million shares) multiplied by 80% as the starting price. In addition, the deposit for this auction is 340 million yuan, and the starting price increases by 8.6 million yuan.
Huachuang Yangan once stated that according to the requirements of relevant laws and regulations, the above-mentioned pledged shares will be given priority compensation, and if the court's judgment is obtained and Jiayu Investment refuses to perform it, it has the right to apply to the People's Court for the payment of the above-mentioned frozen shares auction and sale of the price. Therefore, judging from the starting price of 1.726 billion yuan, it is possible to repay the arrears and interest that Jiayu Investment needs to repay.
In addition, the reporter saw that among the various conditions that bidders should have, they must meet good financial conditions, moderate levels of assets and liabilities and leverage, and their net assets shall not be less than RMB 50 million, and they have the ability to replenish capital that matches the operating business of securities company .
Pacific Securities stated that if the judicial auction and transfer are successful, it will lead to changes in the company's largest shareholder. This judicial auction is still in the public announcement stage, and will follow-up involve auctions, payments, approval from relevant departments, court rulings, share change and transfer. There is uncertainty as to whether the auction and transfer will be successful in the end.
At present, Pacific Securities has not disclosed its 2021 annual report. According to the 2021 annual performance forecast, Pacific Securities expects that the net profit in 2021 will turn losses into profits compared with 2020, with net profits of 90 million to 120 million yuan.
Daily Economic News
