On January 18, a reporter from "Daily Economic News" attended the meeting as an investor and learned on the spot that Shen Jianhong was not present, and all the other three director candidates nominated by Baohetang were present.

Quanjian has been arrested for suspected pyramid schemes, and the controller has been arrested. Why did Baohetang nominate Quanjian's executive as a candidate for director of ST Shengda? This has attracted great attention from the outside world.

Why did he nominate Shen Jianhong as a candidate for ST Shengda’s director? Shan Yang, the actual controller of Baohetang, told reporters that Baohetang mainly operates the traditional Chinese medicine industry, and Quanjian also has a traditional Chinese medicine business. It also denied that some of the funds Baohetang took over ST Shengda came from Quanjian.

On-site voting: Vice President Quanjian won 100% vote against

This shareholders' meeting attracted much attention from the outside world. Before the meeting, the Sichuan Securities Regulatory Bureau and the Shenzhen Stock Exchange successively sent letters to ST Shengda, asking him to explain why he nominated Shen Jianhong as a candidate for the company's director.

At present, ST Shengda has not responded to the above matters.

But at the shareholders' meeting held on the afternoon of January 18, the on-site voting results showed that Shen Jianhong was almost eliminated, and he received 0 votes on the spot and 100% of the votes against him.

"Daily Economic News" reporter also learned on the spot that because Quanjian Group was trapped in a whirlpool of public opinion, especially after its founder Shu Yuhui and other senior executives were detained, Baohetang had already wanted to kick Shen Jianhong out, and originally planned to not review the proposal at the shareholders' meeting on the 18th. However, because the relevant announcement has been issued, there is no time to make corresponding changes, it is given up.

Baohetang is now the actual controller of Shengda Group, the major shareholder of ST Shengda. According to its intention, Shengda Group voted against all Shen Jianhong's related proposals at the shareholders' meeting, and Shen Jianhong's related proposals were also rejected by other small and medium shareholders attending the scene. The other three director candidates nominated by Baohetang, Shan Yang, Feng Chao and Guo Yafei, all received 100% of the votes on the spot.

Baohetang plans to take over 100% of Shengda Group's equity and thus take over ST Shengda. In November last year, Baohetang announced that it would acquire ST Shengda by acquiring 100% of the equity of Shengda Group for RMB 20 million and taking over the latter's huge debt of nearly RMB 4 billion. The actual controller of a listed company will be changed from Jiang Changzheng to the actual controller of Baohetang Shan Yang.

However, because Shengda Group was plagued by a large number of lawsuits due to debt problems, the shares of Shengda Group held by the former actual controller Jiang Changzheng were all frozen, and Baohetang has not yet obtained 100% of Shengda Group's equity. However, Shan Yang has currently served as the chairman and legal representative of Shengda Group.

Baohetang promised to solve the problem of capital occupation

18 shareholders' meeting did not start on time at 2 pm. According to a reporter from the "Daily Economic News", it was mainly because Shengda Group asked Baohetang to issue a letter of commitment to solve the problem of the former's huge illegal funds occupied by ST Shengda. As of January 15, 2018, Shengda Group occupied about ST Shengda's funds, accounting for 55.81% of the listed company's net assets; in addition, without the review of the board of directors and shareholders' meeting of the listed company, ST Shengda illegally provided guarantee balance for Shengda Group to borrow from foreign countries, with a guarantee balance of 160 million yuan.

Shengda Group is willing to sell 100% of its own equity to Baohetang for only 20 million yuan, and at the same time cooperates with Baohetang to let the other party control ST Shengda. The important premise is that Baohetang must solve the problem of huge capital occupation.

Originally, according to the "Equity Transfer Agreement" and related documents of both parties, Baohetang promised to resolve the amount of Shengda Forestry's capital occupation of no less than 200 million yuan by November 30, 2018, and the amount of capital occupation and illegal guarantees of Shengda Group for ST Shengda is no later than December 31, 2018. However, the above arrangement was not realized because the majority of Shengda Group's equity was frozen by creditors.

However, Baohetang agreed to continue to resolve the issue of Shengda Group's capital occupation of ST Shengda, but the detailed arrangements have not been released. According to Jiang Changzheng, the actual controller and chairman of ST Shengda, the meeting was delayed on January 18, which means that the plan should be refined under the auspices of the Sichuan Securities Regulatory Bureau.

"The original plan is just a rough regulation, and there are no punishment measures for breach of contract. If Baohetang does not solve the problem of Shengda Group's capital occupation of ST Shengda, what should we do? It needs to be clarified." Jiang Changzheng revealed.

Shan Yang also revealed that he is trying to solve the problems facing ST Shengda. "We have taken out part of the funds to solve the problem of debts arrears from Shengda Group's suppliers." Shan Yang said, but he did not respond in detail to specific sources of funds and other issues. It is understood that on December 24 last year, some suppliers also went to Shengda Group's headquarters to collect debts.

Jiang Changzheng solved the failure in detail: The problem lies in ourselves

Jiang Changzheng, who was a deputy department-level cadre, made his fortune by forestry and once ranked among the rich in Sichuan with the listing of ST Shengda. Nowadays, its own debt difficulties are plagued by the development of ST Shengda, and ST Shengda has also encountered considerable problems. Why did

fall to its current level? Jiang Changzheng admitted that there was a problem with the company's development strategy, "there should not be integration of forest boards."

Jiang Changzheng revealed that after ST Shengda went public, he held a lot of cash. At that time, he saw that artificial boards were very profitable and were called "money printing machines", so he built new artificial board factories in Guangyuan and other places. However, because everyone saw this business opportunity, it was rushing up to overcapacity. The newly built artificial board factories not only did not make money, but instead made losses repeatedly and became non-performing assets.

. In order to prevent the listed company from being dragged down, Jiang Changzheng was preparing to divest the relevant forestry assets from ST Shengda, but no one looked at it. "Originally, we were preparing to divest a little bit, and no one could accept it, so we could only let Shengda Group take it." Jiang Changzheng said.

In December 2016, ST Shengda announced the divesting of assets such as home forests from Shengda Group. In order to raise 941 million yuan in cash consideration, Shengda Group borrowed 1.4 billion yuan from Huabao Trust through the pledge of ST Shengda's equity. Later troubles arose.

"The fuse was Huabao Trust suing us." Jiang Changzheng said that one of the money borrowed from Huabao Trust had expired, and Shengda Group was sued by the other party for losing money in succession. A series of chain reactions of

also appeared. Some banks saw that Shengda Group was sued by Huabao Trust, and it was even more difficult for the group to borrow money from the bank. Jiang Changzheng originally planned to mortgage the forestry assets from ST Shengda to raise funds from the bank, but forestry assets are different from real estate, and in the end this wishful thinking failed.

"There are also changes in the country's financial environment, deleveraging and other factors in the middle, but the main problem lies in ourselves," said Jiang Changzheng.

Jiang Changzheng denied embezzling hundreds of millions of yuan for stock trading

It is worth mentioning that when ST Shengda's equity was pledged to Huabao Trust, ST Shengda's stock price was about 10 yuan per share, but later ST Shengda's stock price hit the limit for 9 consecutive days. As of January 18 this year, its stock price was only 2.32 yuan per share.

"At that time, the stock price hit the limit continuously, and the stocks pledged at Huabao Trust were close to liquidation. Huabao Trust notified us to fill in the position." Jiang Changzheng revealed.

At this time, financial institutions are no longer willing to renew their loans and are still urging them to pay back the money. For this reason, Jiang Changzheng borrowed a lot of funds from some micro-loan companies. "It was originally just a short-term stage. I made a bridge fund and returned the funds from the bank." Jiang Changzheng said that 200 million yuan of it was given to Huabao Trust for filling out the position.

is a borrowing money, Jiang Changzheng also illegally guaranteed Shengda Group's loan in the name of ST Shengda. According to ST Shengda, Shengda Group borrowed 25.65 million yuan, 10 million yuan, 140 million yuan and 50 million yuan respectively for four people, Jiang Lan, Qin Dongliang, Yang Chen and Cai Yuanyuan.

Jiang Changzheng revealed that the 140 million yuan borrowed by Yang Chen in December 2017 was actually borrowed by Zhongcai Investment Group Co., Ltd. Yang Chen said that it is a comprehensive enterprise group involved in financing guarantee, pawn auction, futures brokerage and other fields. According to a recent report by China Securities Journal, Yang Chen's loan principal was only 110 million yuan, and the interest rate was as high as 30 million yuan.

paper cannot keep the fire. Originally, ST Shengda obtained nearly 1 billion yuan in cash by divesting forestry assets, plus the funds raised in the account, which was a huge amount of money. Under Jiang Changzheng's operation, after ST Shengda's illegal guarantee for Shengda Group was exposed, a large number of creditors asked ST Shengda to bear joint and several liability, and some funds in the listed company's accounts were also transferred away, and ST Shengda was also taken into the ditch.

Some media reports questioned that Jiang Changzheng misappropriated ST Shengda's funds for stock trading. Jiang Changzheng denied this. It said that even when ST Shengda's stock price plummeted continuously, it was meaningless to use money to maintain the stock price. "The accounting firm designated by the regulatory authorities has checked our accounts inside and outside, and there is no such problem." After the

meeting, the new directors of ST Shengda Shan Yang, Feng Chao and Guo Yafei all had a simple exchange with the shareholders on site. Shan Yang said that he has been in the traditional Chinese medicine industry for more than 30 years and may include Baohetang's traditional Chinese medicine industry in the future into listed companies. Guo Yafei said that in the future, he will be responsible for more matters in financial operations and other aspects.

"Daily Economic News" reporter noticed that as of 10 a.m. on January 19, the results of ST Shengda's shareholders' meeting yesterday have not been released, but it is almost a foregone conclusion that the deputy general manager of Quanjian was defeated as a director.

(Editor in charge: Zhang Qianrong)