"Science and Innovation Board Daily" (Beijing, reporter Guo Hui) reported that optoelectronics device manufacturer Guilin Guanglong Technology Group Co., Ltd. (hereinafter referred to as "Guanglong Technology") was recently accepted for the IPO of the Science and Technology Innovation Board. It plans to raise 750 million yuan to be used for the construction of optical chip semiconductor full process process production line construction projects, subsystems and optical device production and construction projects, and 160 million yuan will be used to supplement working capital.
Guanglong Technology's optical chip products have been successfully developed and mass-produced since 2020, contributing revenue to the company - although it is only 3.2196 million yuan. It is also since last year that the company's optical components, TO-CAN products, passive optical devices, subsystems and other products have increased sales or unit prices, and together helped Guanglong Technology turn losses into profits during the reporting period. Although
is under the market's demand for 5G and computing centers, its performance has grown significantly, as downstream companies in the optical communications industry chain such as Huawei gradually extend to the upstream of optical chips, Guanglong Technology is under considerable pressure in R&D work. In addition, the company applied to enter the Science and Technology Innovation Board with a betting agreement with a recovery condition, and there may be certain variables on the road to listing.
optical chip project is still in its early stages. The subsequent R&D power needs to be supplemented. The optical communication industry in which Guanglong Technology is located is mainly composed of three parts: optical communication devices, optical communication systems and optical communication applications. Guanglong Technology's main products cover various types of optical communication devices such as optical communication chips, passive optical devices and subsystem products, and are at the upstream of the industrial chain.
optical communication system is the middle of the industrial chain, and the participants are mainly communication system equipment manufacturers, such as Huawei, ZTE, Fenghuo, etc.; optical communication applications are the downstream of the industrial chain, mainly including basic telecom operators and Internet content providers.
my country has a huge downstream application market, which has promoted the development of the optical communication industry to show a pattern of gradual development and maturity from bottom to top. According to Guanglong Technology, domestic communication system manufacturers such as Huawei, ZTE, and Fenghuo have all ranked among the world's first-class level. Domestic major optical module manufacturers such as Zhongji Xuchuang, Guangxun Technology, Xinyisheng, and Huagong Zhengyuan have also grown to the forefront of the industry, but there are still shortcomings in the field of optical chips and optical devices that are upstream of the industrial chain.
According to the prospectus, Guanglong Technology is trying to build a full process process platform for optical chips in the field of optical chips. Currently, it mainly focuses on two subsidiaries - Lei Guang Technology and Xinfei Technology, to develop the above related advanced technologies and processes. Among them, Leiguang Technology was jointly established by Guanglong Optoelectronics and foreign-funded enterprise AGX Technologies Inc., with revenue of 115 million yuan in the first half of this year. Guanglong Technology holds 65% of the equity.
Guanglong Technology said that it is one of the few domestic companies that master the complete set of laser chip production technology, and can also directly undertake various optical chip TO packaging businesses internally and externally.
Guanglong Technology's IPO on the Science and Technology Innovation Board, which plans to raise 368 million yuan to build an optical chip semiconductor full process process production line construction project will be used for the mass production of DFB laser chips. EML, one of the three core optical chips in the industry, has also begun research and development in 2021. In the first half of this year, optical chip products contributed nearly 9 million yuan to Guanglong Technology, while last year it was only 3.2196 million yuan.
and TO-CAN are now one of Guanglong Technology's main products, which refer to optical devices formed by combining optical chips through the above-mentioned TO packaging process with other raw materials such as tube caps and tube sleeves. In 2020, Guanglong Technology's sales of TO-CAN products reached 36.3289 million, an increase of 75.52% from 2019, while its revenue accounted for 25.06% in the first half of this year.
In 2020, my country entered a period of rapid development of 5G network construction. Last year alone, my country added more than 580,000 new 5G base stations. Driven by the demand for midstream communication system equipment and upstream optical communication devices in the optical communication industry chain, Guanglong Technology's overall performance and segmented business have leaps to varying degrees from 2018 to 2020. The total revenue during the period was 175 million, 192 million and 273 million, respectively, while the total revenue in the first half of this year reached 142 million.
It is worth noting that Guanglong Technology's net profit attributable to shareholders in 2019 was 8.269 million yuan, and it only turned a profit since 2020, achieving 14.8498 million yuan, and continued to maintain a profit of 6.6232 million yuan in the first half of this year.
According to Guanglong Technology, is currently accelerating the infrastructure of my country's 5G communication network and expanding investment capacity of data center operators, more and more large downstream enterprises in the industrial chain with strong capital and talent advantages, such as Huawei and Fenghuo, have extended to the optical chip and device fields.
, and Guanglong Technology's latest R&D personnel were 97, and the proportion of R&D personnel during the reporting period was 14.75%, 16.90%, 12.15% and 12.33% respectively; there were 9 invention patents that formed main business income during the reporting period, all of which were only slightly higher than the requirements of the Science and Technology Innovation Board for the company's science and technology innovation attributes. In addition, in terms of R&D investment, Guanglong Technology's R&D expense ratio is slightly higher than the average value of comparable companies such as Guangxun Technology, Shijia Photonics, and Bochuang Technology.
termination of the betting agreement will be subject to recovery conditions
Guanglong Technology's predecessor was established in 2001 and completed the share reform in 2015. At present, the company's controlling shareholder and actual controller are Peng Hui, and he also serves as the company's legal representative and chairman, holding 26.29% of the company's shares. Peng Hui signed a joint action agreement with his younger brother Peng Peng and sister Peng Dan, with a total holding of 39.4% of the shares.
Other major shareholders holding more than 5% of the issuer's shares are Feishang Industrial, Chaopeng Investment, Jinlan No. 2, Dachen Chuanghong, and Chen Chunming.
Among them, the private equity institution worthy of attention is Dachen Chuanghong. The investors behind it include Shenzhen Dachen Caizhi Venture Capital Management Co., Ltd., Hunan Radio and Television Media Co., Ltd., etc.
In March 2021, Dachen Chuanghong acquired a total of 2.34 million shares from the company's shareholders Peng Hui, Peng Peng and Chen Chunming at a price of 15.38 yuan per share, and increased its capital and subscribed 3.61 million shares at a "high price" of 27.69 yuan per share.
Not only that, a reporter from the Science and Technology Innovation Board Daily noticed that in the process of the above-mentioned capital evolution, Dachen Chuanghong also signed a "Supplementary Agreement for Share Issuance and Subscription Agreement" with Guanglong Technology, which contains the "bet agreement" with special arrangement terms such as listing requirements, share repurchase or acquisition, and anti-dilution.
It is worth noting that the above betting terms have been terminated in the part of the issuer Guanglong Technology as the repurchase party, but the parties to the betting still include the company's actual controller Peng Hui. If this listing on the Science and Technology Innovation Board fails, Dachen Chuanghong claims that Peng Hui’s right to repurchase part or all of the shares of Guanglong Technology held by Dachen Chuanghong will automatically resume its effectiveness. In addition, the betting agreement signed by Guanglong Technology with Guangtou Guofu, Xingrui and Sheng also did the same.
pictures | Guanglong Technology's prospectus description on the conditions for the recovery of the betting agreement
Lawyer Xu Zhigang and Zhang Yang of Zhonglun Law Firm previously wrote an article saying that compared with other A-share IPO listing sections, the "Shanghai Stock Exchange Science and Technology Innovation Board Stock Issuance and Listing Review Question and Answer (II)" on the Science and Technology Innovation Board is in the form of a question and answer. For the first time, the concept of the betting agreement and its application to the Science and Technology Innovation Board is clearly stated. In order to meet the four requirements of the issuer's inaction as a party to the betting agreement, the betting agreement can be opened without clearing.
According to the bet agreements and their handling methods disclosed by many companies in the issuance and review materials of the Science and Technology Innovation Board by Zhonglun Law Firm, most of them added agreed agreements before the issuance and review were finally passed.
Take Borui Medicine, Sani Medical and Transsion Holdings, which have successfully landed on the Science and Technology Innovation Board as an example. Before listing, the betting agreement signed by the previous betting agreement was made with the conditions for recovery, but it did not receive the approval of the regulatory authorities. In the end, the three companies further added the agreement to completely terminate and not resume their effectiveness before completing the listing registration.
also takes Bolite, a listed company on the Science and Technology Innovation Board, as an example. It initially agreed to terminate the bet with recovery conditions before listing, but after the issuer and sponsor fully explained that they met the four requirements of Question 10 of the "Audit Question and Answer (II)" and passed the review.
Bolite said that the parties to the betting agreement it signed are the actual controller of the company and have the funds required to repurchase equity, and the betting agreement will not cause a change in control during the company's listing review period and after listing.
A lawyer engaged in corporate listing and mergers and acquisitions in Beijing said that the supplement to the original betting agreement of Guanglong Technology does have recovery conditions, which is similar to the relevant arrangements of Berlit. However, he also said that the review of the betting agreement is "very policy-oriented" and "can be rectified according to the review opinions, and if it is terminated, it is likely to be passed."
"When the issuer has not successfully achieved listing, it is inevitable that it is a bit reluctant to let the investor completely give up his existing betting rights. The result of the interest game is that a termination with recovery conditions has been developed in the market - the parties agreed that the betting agreement will be terminated when the issuer declares listing and will resume its effectiveness when the listing is withdrawn or the listing is rejected." The article by lawyers Xu Zhigang and lawyers Zhang Yang said in this way.
Regarding why Guanglong Technology did not completely remove the bet terms before listing, the company stated that it will not accept media interviews because the company has been busy recently.
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