Every reporter: Xu Shuai Every editor: Wei Guanhong
On the evening of December 15, the agricultural and animal husbandry giant New Hope (000876. SZ, share price of 9.31 yuan, market value of 42.321 billion yuan) disclosed two major capital moves, one is to sell its subsidiary Shandong Zhongxin Food Group Co., Ltd. (hereinafter referred to as Zhongxin Food) 51% of the equity to the central enterprise China Animal Husbandry Industry and Commerce Group Co., Ltd. (hereinafter referred to as China Animal Husbandry Group). Second, it is planned to transfer 67% of the equity of Deyang New Hope Liuhe Food Co., Ltd. (hereinafter referred to as Deyang Food) for 1.5 billion yuan, and after this transaction, the listed company will no longer be engaged in food deep processing business.
In the eyes of industry insiders, the new hope and the animal husbandry group between the "marriage" of the poultry industry chain is of deep significance, the animal husbandry group to complete its white feather poultry downstream industry chain, is conducive to the integration of the original advantageous resources, to further strengthen the agricultural industry. New Hope can also combine the advantageous industrial resources of partners to enhance the industry competitiveness of the white feather meat and poultry business. This is also conducive to New Hope to optimize the capital structure, increase income, improve the return on investment, and protect the interests of shareholders, especially small and medium-sized shareholders.
The state-owned enterprise China Animal Husbandry Group plans to acquire 51% of the equity of a subsidiary of New Hope
On the evening of December 15, New Hope announced that it intends to sell 51% of the equity of its subsidiary Zhongxin Food to China Animal Husbandry Group, with a total transaction amount of 2.7 billion yuan. If the transaction is completed, China Animal Husbandry Group will become the controlling shareholder of Zhongxin Food.
In view of the purpose of this transaction and the impact on the company, New Hope said that the company took the initiative to adjust its development strategy and industrial structure, focus more on the two core businesses of feed and pig breeding, concentrate resources, optimize management, and support the two main businesses to become better and stronger. China Animal Husbandry Group and its controlling shareholder, China Agricultural Development Group, have deep industrial resources and a strong industrial development vision, and this transaction will be conducive to the further enhancement of the core competitiveness of the white feather meat and poultry business.
In terms of shareholding ratio, New Hope holds 20% of its equity, Shandong Liuhe, a subsidiary of New Hope, holds 51% of its equity, and Beijing New Hope, a subsidiary of New Hope, holds 29% of its equity. In this transaction, New Hope intends to transfer 20% of the equity of Zhongxin Food, Shandong Liuhe intends to transfer 2% of the equity of Zhongxin Food, and Beijing New Hope intends to transfer 29% of the equity of Zhongxin Food.
Zhongxin Food, formerly known as New Hope's poultry industry BU, is responsible for the operation of the company's poultry industry chain, covering poultry breeding, poultry slaughtering, cooked product processing, poultry product sales, etc. As of August 31, 2023, Zhongxin Food's total assets were 10.503 billion yuan, total liabilities were 8.680 billion yuan, and net assets were 1.593 billion yuan. In January ~ August this year, Zhongxin Food's operating income was 13.632 billion yuan and its net profit was 5.8419 million yuan.
Image source: Screenshot of New Hope's announcement
It is worth mentioning that public information shows that Zhongxin Foods will account for 10% to 15% of China's frozen duck meat market in 2022. The company has 14 "integrated" business units, covering the core consumption areas of poultry meat in East China, North China, Northeast China, Central Plains and Central China, and is a complete "feed-breeding-breeding-slaughtering-processing" industrial cluster.
As the counterparty of the transaction, China Animal Husbandry Group is a large-scale modern agriculture and animal husbandry central enterprise integrating production and operation, trade services, scientific and technological development and investment and financing, and the actual controller is China Agricultural Development Group Co., Ltd. As of August 31, 2023, the total unaudited assets of China Animal Husbandry Group were 16.343 billion yuan, the total liabilities were 8.076 billion yuan, and the net assets were 8.267 billion yuan. In January ~ August 2023, the operating income of China Animal Husbandry Group was 17.475 billion yuan and the net profit was 561 million yuan.
For China Animal Husbandry Group, it has been deeply involved in the upstream poultry veterinary drugs and vaccines, poultry market for many years, and now plans to enter the mature downstream industry chain. Through this acquisition, China Animal Husbandry Group will obtain the "Zhongxin Duck" germplasm resources with its own intellectual property rights in China.
The listed companies controlled by the animal husbandry group are also growing their own industrial chain downstream. China Animal Husbandry Co., Ltd. (600195. SH, share price of 11.81 yuan, market value of 12.06 billion yuan) has been in 2020 and 2022 with Longda Meat (002726. SZ, share price 8.25 yuan, market value 8.903 billion yuan), Muyuan shares (002714. SZ, share price of 39.39 yuan, market value of 215.28 billion yuan). This time, China Animal Husbandry Group chose New Hope as the object of "marriage", which will complement its downstream industrial chain of white feather meat and poultry, which is conducive to the integration of original advantageous resources and further strengthen and strengthen the agricultural industry.
New Hope will unite the superior industrial resources of its partners
The reporter of "Daily Economic News" noticed that the introduction of war investment by New Hope may have been planned for a long time. At the analyst meeting on December 1, Chen Xingyao, vice president and chief financial officer of New Hope, said, "The company's current strategy is to insist on taking feed as the cornerstone industry of the company on the one hand, and on the other hand, to strengthen the breeding capacity...... For other industrial sectors, it will focus on building core competitiveness, and some sectors will help them strengthen their professional operation capabilities by introducing strategic investors and other ways. ”
The "marriage" of the planned and China Animal Husbandry Group is also the introduction of new strategic investors for the subsidiaries of New Hope. New Hope said that on the one hand, the company can combine the superior industrial resources of partners to enhance the industry competitiveness of the white feather meat and poultry business, and on the other hand, it is also conducive to the company to optimize the capital structure, increase revenue, improve the return on investment, and protect the interests of shareholders, especially small and medium-sized shareholders.
New hope also pointed out in the announcement that China Animal Husbandry Group and its controlling shareholder China Agricultural Development Group has deep industrial resources and a strong vision of industrial development, after the transfer of equity, China New Food will be controlled by China Animal Husbandry Group, relying on the resources, help and support of the two shareholders, continue to do a good job, and bring positive returns to the shareholders of the two parties. The two sides will also work together to integrate resources on the basis of existing industries and further enhance the status and industrial capabilities of the industry.
The announcement also mentioned that at the same time as the implementation of this transaction, China Agricultural Development Group and New Hope Holding Group Co., Ltd. will sign a strategic cooperation agreement to actively establish a comprehensive strategic cooperative relationship, focusing on independent intellectual property rights breeding, grain, meat, eggs and milk supply, agriculture and animal husbandry industry chain construction and other fields, to carry out pragmatic cooperation, and promote each other's mutual promotion, support and promote the development of in-depth cooperation between the two sides in the above agricultural industry fields. At the same time, the major shareholder of New Hope, Southern Hope Industrial Co., Ltd., will provide active support and guarantee to China Animal Husbandry Group on the future business performance of Zhongxin Food for a certain period of time after the completion of the transaction.
Listed companies will no longer be engaged in food deep processing
In addition to the introduction of war investment, New Hope also announced that it intends to transfer 67% of its shares in Deyang Food to Hainan Shengchen Investment Co., Ltd. (hereinafter referred to as Hainan Shengchen), with a transaction price of 1.5 billion yuan. New Hope said that the proposed introduction of advantageous industrial resources of related parties to the food deep processing business this time can also provide assistance for the company's long-term sustainable development.
According to the announcement, Deyang Food was established in 2007 and is the operating body of New Hope's food deep processing business. As of November 30, 2023, Deyang Food's total assets were 3.239 billion yuan, total liabilities were 2.357 billion yuan, and net assets were 671 million yuan. In January ~ November this year, the company's operating income was about 3.7 billion yuan, and the net profit attributable to the parent company was 141 million yuan.
Image source: Screenshot of New Hope's announcement
The transferee, Hainan Shengchen Investment Co., Ltd., is the investment platform of New Hope Investment Group Co., Ltd., and belongs to the same New Hope Group as New Hope. New Hope said that after this transaction, Deyang Food will no longer be consolidated into the financial statements of listed companies, and the listed company will no longer be engaged in food deep processing business.
In this regard, New Hope explained in the announcement that this move is a move by listed companies to take the initiative to adjust their development strategy and industrial structure, in order to focus more on the two core businesses of feed and pig breeding, concentrate resources, optimize management, and support the two main businesses to become better and stronger; It is conducive to the company to optimize the capital structure, increase income, improve the return on investment, and protect the interests of shareholders, especially small and medium-sized shareholders. Regarding the future development direction and strategy of the food deep processing business, New Hope emphasized, "Xintou Group has deep industrial resources on the consumer side, and this transaction will be conducive to the further enhancement of Deyang Food's competitiveness, integrating resources on the basis of existing industries, and further enhancing the industry's status and industrial capabilities." ”
National Business Daily