The acquisition of Haoan Energy is the first step for Mubang Hi-Tech to transform from the single business of educational toys to the dual main business of “educational toy industry + photovoltaic industry”. And now the acquisition plan is out.
On February 15, Mubang Hi-Tech (603398, SH), known as the “Chinese version of LEGO”, announced that it intends to acquire Inner Mongolia Haoan Energy Technology Co., Ltd. (hereinafter referred to as Inner Mongolia) jointly held by Zhang Zhongan and Yu Jumei in cash. Haoan) 100% equity, the transaction price is tentatively set at 1.1 billion yuan. After the completion of this transaction, the company’s main business will increase the research and development, production and sales of photovoltaic silicon wafers and silicon rods. The reporter of “Daily Economic News” noticed that compared with the net assets of Inner Mongolia Haoan in 2021, the price of this transaction is more than 5 times premium.
It is proposed to acquire a photovoltaic company for 1.1 billion yuan
On January 10 this year, Mubang Hi-Tech announced that it planned to acquire 100% equity of Inner Mongolia Haoan. The stock price of Mubang Hi-Tech fluctuated sharply in the three trading days before the announcement.
According to the announcement today (15th), the transaction price of 100% equity of Inner Mongolia Haoan, the subject asset of this transaction, is tentatively set at 1.1 billion yuan. The reporter noticed that as of the end of last year, the net assets of Inner Mongolia Haoan were 170 million yuan. Based on this, the price premium of this transaction was more than 5 times.
Mubang Hi-Tech will make the acquisition through cash payment, and the sources of funds include but are not limited to its own funds, bank loans, and non-public issuance of shares to raise funds. On the 15th, Mubang Hi-Tech also released a non-public offering of shares. It plans to raise funds of 2.415 billion yuan, of which 1.1 billion yuan will be used for the acquisition of 100% equity of Inner Mongolia Haoan.
It is worth noting that according to the Equity Acquisition Framework Agreement, the two parties will make payments according to the transaction progress, of which 600 million yuan will be paid by the company year by year during the performance commitment period, that is, in 2022, 2023, and 2024 (hereinafter referred to as the performance). Commitment period) to pay 200 million yuan to the counterparty after the annual report.
During the performance commitment period, Inner Mongolia Haoan shareholders Zhang Zhongan and Yu Jumei committed to the company’s target net profit (the lower before and after deducting non-recurring gains and losses) were 140 million yuan, 160 million yuan, and 180 million yuan, respectively.
So what is the current performance of Inner Mongolia Haoan? In 2020 and 2021, the operating income of Inner Mongolia Haoan will be 341 million yuan and 826 million yuan respectively, and the net profit will be 22.6336 million yuan and 104 million yuan respectively. Within one year, Inner Mongolia Haoan’s operating income has increased by 1.4 times, and its net profit has increased by nearly 3.6 times. It can be seen that the company is currently in a period of rapid growth.
Why cross-border photovoltaics?
Mubang Hi-Tech changed its name in November last year, and its securities were previously referred to as Bangbao Puzzle. As its name suggests, the main business of Mubang Hi-Tech mainly includes educational toys business, medical equipment business, education business and precision non-metal mold business, among which the toy business accounts for over 70%. In 2020, the revenue of the toy business accounted for 77.64% of the main business revenue of Mubang Hi-Tech.
The main business of Inner Mongolia Haoan is the research and development, production and sales of photovoltaic silicon wafers and silicon rods. At present, a 1.5GW monocrystalline silicon rod project has been completed. The main customers are Jiangsu Shunfeng New Energy Technology Co., Ltd. and Jiangsu Runyang Yueda Photovoltaic Technology Co., Ltd., etc.
Why did Mubang Hi-Tech make a cross-border, high-moat photovoltaic industry from toy manufacturing?
In the past two years, the performance of Mubang Hi-Tech has been poor and declined. In 2020, the operating income was 502 million yuan, a year-on-year decrease of 6.62%, and the net profit was 40 million yuan, a year-on-year decrease of 47.38%. Mubang Hi-Tech also expects a loss in net profit attributable to the parent in 2021, with an estimated loss of 130 million to 140 million yuan.
The decline of Mubang Hi-Tech’s performance is more affected by the new crown epidemic. Mubang Hi-Tech stated in its performance forecast that the COVID-19 epidemic continued to turbulent, the downstream market demand in the industry was unstable, international freight costs rose sharply, upstream raw material procurement costs continued to rise, and market business promotion costs increased. Mubang Hi-Tech stated that after the completion of the transaction, Inner Mongolia Haoan will greatly improve the asset quality and profitability of the listed company, and enhance the sustainable operation ability.
In addition to reversing the situation of poor performance, the reason why Mubang Hi-Tech crossed the photovoltaic industry may stem from its new actual controller, Liao Zhiyuan. Liao Zhiyuan has been in constant motion since he took over the company last year. First, he moved the registered address to Anyi County, Nanchang, Jiangxi Province, and then changed the name of the company. The acquisition transaction parties Zhang Zhongan and Yu Jumei also have a company named Jiangxi Haoan Energy Technology Co., Ltd., which happens to be located in the same county as the new registered address of Mubang Hi-Tech.
Liao Zhiyuan also has a listed company Xinyuan Technology (300472, SZ), which is also involved in the photovoltaic industry. In September last year, Xinyuan Technology announced that it had signed a contract of 249 million yuan with Shangrao Industry and Finance Supply Chain Management Co., Ltd. to sell automated production equipment for the purification and recycling of silicon waste.
Source of cover image: Photo by Liu Guomei of Daily Economic News
