Original title: Huarong takes over Tianxing International, and who is the benefit behind?_Caixin.com Lai Xiaomin, the former chairman of Huarong, the head of the four major AMCs, was investigated, involving the core figure Zhou Huorong.Zhou Huorong was originally Lai Xiaomin's pacesetter in Huarong's turnaround. He led Huarong's Guangdong company and Shenzhen branch for many years, and became the chairman of Huarong International in 2013.In May 2016, Zhou Huorong retired early and joined Huarong's shadow company Tianyuan Financial.However, in the process of Huarong International's backdoor listing, many suspicious circumstances of profit transfer were exposed. All shareholders related to the tomorrow's relationship withdrew, and Tianyuan Financial, which was transfused by Huarong, came in to take over.Exiters profited from the sharp rise and fall of Huarong Financial Holdings' stock price.(For the background of the characters, please refer to Caixin’s new vertical product on WeChat I Wen WeNews Financial People middot; Things Zhou Huorong and Lai Xiaomin)
What Tianyuan Financial took over was Huarong's first overseas backdoor listing entity—Tianxing International (00993.HK, later renamed Huarong Financial Holdings).In August 2015, Skyline International issued 1.702 billion new shares to Huarong International, accounting for 51.93% of the issued shares of Skyline International after the share expansion; Huarong International through its wholly-owned subsidiary Camellia Pacific Investment Holding Limited (hereinafter referred to as Camellia Pacific), subscribed for this part of the shares at a price of HK$0.275 per share, and became the largest shareholder of Tianxing International in one fell swoop.
Tianxing International was originally a Hong Kong local securities firm (the stock price was less than 1 yuan for a long time), and suffered heavy losses.In December 2009, Super Century Investments Limited, which is considered to be closely related to the Tomorrow Department, acquired 651 million shares of Tianxing International at a price of 130 million yuan from Hong Kong wealthy businessman Zhang Renlong and others.60.1% of the share capital.On November 28, 2011, the shareholders of Jiayuan Investment changed from natural persons Peng Xiaodong and Li Jiangnan to Peng Xiaodong and Ji Xiaobo. On October 31, 2014, the shareholders of Jiayuan Investment changed to Tong Liang.
Regarding the previous shareholders of Jiayuan Investment, there are few public information mentioning their wealth history and identity information.Among the four, the only one with more public reports is Ji Xiaobo—the boyfriend of Taiwanese movie star Pace Wu, the former owner of the casino in Saipan, and the actual controller of Imperial Pacific (01076.HK).Ji Xiaobo, born in 1979, is a native of Harbin. He is exquisite in appearance and has a close relationship with Che Feng, an active figure in the capital market who was investigated earlier (see Caixin Weekly, 2015, No. 24, who took over the rich man Che Feng).From November 28, 2011, Ji Xiaobo became the executive director and executive president of Tianxing International until his resignation on February 6, 2013.
Prior to Ji Xiaobo, Sun Darui, who had served as the acting chairman of Baotou Huazi Industrial Co., Ltd. and the general manager of Shanghai Aishi Co., Ltd., took up the post of executive director and chairman of Tianxing International on April 23, 2010.At that time, the equity transfer between Jiayuan Investment and Zhang Renlong and others was completed, and Zhang Renlong and others all withdrew from the management of Tianxing International.
Between December 2009 when Jiayuan Investment became a shareholder and August 2015 when Huarong became the main shareholder, the change of the new major shareholder of Tianxing International was like a revolving lantern, and the price experienced a terrible rise and fall, from less than 1 Hong Kong dollar to a maximum of 40 Hong Kong dollars, and then back to about 1.6 Hong Kong dollars, it can be described as a roller coaster.
Among them, the first new major shareholder is Pacific Industrial.On May 27, 2011, Jiayuan Investment and Pacific Industrial entered into two agreements: one was to sell 100 million shares of Tianxing International held by it to Pacific Industrial at a price of 0.2 Hong Kong dollars per share, with a total price of 20 million Hong Kong dollars;With the stock of a wholly-owned subsidiary of Tianxing International as offset, a loan of 37 million Hong Kong dollars was borrowed from Pacific Industrial with an annual interest rate of 10%.A few days later, on June 23, the two parties entered into a second financing agreement. Jiayuan Investment continued to use the shares of Tianxing International as collateral to borrow 203 million Hong Kong dollars from a wholly-owned subsidiary of Pacific Industrial, with an annual interest of 10%.On July 1, 2011, the two parties signed a supplementary agreement, the loan amount was reduced from 203 million Hong Kong dollars to a maximum of 75 million Hong Kong dollars, the interest was raised from 10% to 24%, and Ji Xiaobo was added as a guarantor.
As of October 31, 2011, Jiayuan Investment held 7.054 billion shares of Tianxing International, accounting for 25.86%.Due to the aforementioned pledge and purchase, Pacific Industrial indirectly holds 9.154 billion shares of Tianxing International, accounting for 33.56%.Since then, Tianxing International shares have been allotted and rights issued several times, and both parties have continued to buy and sell. As of April 30, 2013, the shares held by Jiayuan Investment have become 564 million shares, with a share ratio of 22.19%, and Pacific Industrial has 168 million shares.The ratio is 6.61%. Kingston Financial Group holds 1.057 billion shares that failed to subscribe due to underwriting rights issues, accounting for 41.60%.
During this period, the stock price of Tianxing International has been jumping up and down below 1 Hong Kong dollar; but soon, the stock price took an astonishing jump.
On October 2 and 17, 2013, Tianxing International issued two announcements—planning to acquire a financial consulting company in Beijing at a price of 260.5 million Hong Kong dollars, and planning to issue 100 million convertible notes to raise 500 million Hong Kong dollars forAcquisitions and others.For a time, the share price of Tianxing International soared from less than 1 cent per share at the beginning of the month to 16.5 Hong Kong dollars per share at the end of the month.Of course, there was an ambush long before the skyrocketing.On September 26, the transaction volume of Tianxing International was heavy, and the net buying funds on that day soared from one million Hong Kong dollars on weekdays to 20.312 million Hong Kong dollars, and jumped to 201 million Hong Kong dollars on the second day.The shareholdings of Jiayuan Investment and Pacific Industrial also changed dramatically during this period.On October 31, 2013, the number of shares held by Jiayuan Investment dropped to 14.1 million shares, accounting for 22.19%, and Pacific Industrial held 6.275 million shares, accounting for 9.87%.
However, in July 2014, Tianxing International announced that it had decided to terminate the acquisition due to unsatisfactory due diligence results.
In mid-February 2014, the stock price of Tianxing International experienced a new round of sharp rise, from the 10-day average price of HK$10.79 per share on February 10 to the highest price of HK$40.1 on March 12.While the fire was cooking, the stakeholders of Tianxing International staged a dazzling equity transfer transaction.Liu Yanhong entered the market by subscribing for the aforementioned HK$500 million convertible notes; then, on April 3, 2014, Liu Yanhong transferred all the convertible notes to Huaneng Investment Co., Ltd. (hereinafter referred to as Huaneng) held by Huang Peihai; six days later,Huaneng converted HK$135 million of the convertible notes into 270 million Tianxing International shares.By the end of the month, Jiayuan Investment held 141 million shares of Tianxing International, accounting for 15.58%; Pacific Industrial held 62.75 million shares, accounting for 6.93%; Huaneng Investment held 270 million shares, accounting for 29.82%
On July 6, 2014, Huaneng transferred all the remaining 365 million Hong Kong dollar convertible notes to Liu Yanhong, and Liu Yanhong transferred 265 million Hong Kong dollar convertible notes to Cui Zhanhui;Cui Zhanhui converted 235 million convertible notes into 470 million Tianxing International shares, and the remaining 30 million Hong Kong dollar convertible notes (convertible into 60 million Tianxing International shares).It should be noted that as of October 31, 2014, the amount of 141 million shares held by Jiayuan in Tianxing International remained unchanged, and the shareholding ratio shrank to 8.95%.Cui Zhanhui became the largest shareholder of Tianxing International with 530 million shares, accounting for 29.83%; Huaneng held 270 million shares, accounting for 17.14%; Liu Yanhong held 200 million shares, accounting for 12.69%.Until April 30, 2015, this shareholding situation has not changed.And these shareholders have enjoyed a new wave of stock price effects brought about by Huarong International's backdoor.
On October 7, 2014, Tianxing International announced that it would introduce Huarong International.In March 2015, Tianxing International announced the issuance of 1.702 billion new shares to Huarong International, accounting for the enlarged shares of Tianxing International51.93% of the issued shares; Huarong International, through its wholly-owned subsidiary Camellia Pacific, subscribed for this part of the shares at a price of HK$0.275 per share, becoming the largest shareholder of Tianxing International in one fell swoop.Subsequently, Tianxing International changed its name to Huarong Financial Holdings.This news stimulated the share price of Tianxing International from around HK$1.6 to a peak of HK$9 per share on June 12, 2015.
During this period, the shareholding of Tianxing International changed.On June 3, 2015, Cui Zhanhui mortgaged 200.34 million of the 530 million shares he held to Kingston Finance Co., Ltd. (hereinafter referred to as Kingston) controlled by Li Yuehua.Ten days later, Huaneng Investment mortgaged all 270 million shares it held to Zhongfan International Capital Investment Management Co., Ltd. under the name of Lu Zhiqiang.
On June 15, 2015, the stock price of Tianxing International Co., Ltd. turned around and closed at HK$7.15 per share, a drop of 5.67%.By July 8, 2015, the closing price of Tianxing International had dropped to HK$2.98 per share.After experiencing a sharp rebound in the next two trading days, the stock price of Tianxing International began to fluctuate and fell, falling to around HK$2 per share in November 2016.As of the last trading day before Lai Xiaomin was investigated, it closed at HK$2.31.
Don't be afraid of the stock price falling, Huarong's shadow company will take over.Tianyuan Financial and Xionglian Enterprises under China Harbor Bridge began to quietly invest in shares.Tianyuan Financial is actually a shadow stock of Huarong, has received a large number of blood transfusions from Huarong for many years, and is the second largest shareholder of China Harbor Bridge.(See Caixin Weekly, Issue 16, 2018, What Lai Xiaomin Did in Huarong) According to the annual report of Huarong Financial Holdings, as of December 31, 2016, Tianyuan Financial and its subsidiary Xionglian Enterprise Co., Ltd. held Huarong Financial Holdings respectively.17.02% and 3.59% of the shares, Camellia Pacific still holds 1.702 billion shares of the company, accounting for 51%.The aforementioned Cui Zhanhui, Huaneng Investment, and Liu Yanhong have all disappeared; Jiayuan Investment, which originally held 7 billion shares, still has a small share in its hands, only 111 million shares, accounting for 3.33%.
On May 8, Huarong Financial Holdings closed at HK$1.79.It still looks higher than the price of HK$0.275 that Huarong bought the shell company, but the transaction volume is getting weaker.And in this drama of capital operation, what role did Huarong play, and who made a lot of money?
