Chongqing aims to build a new sensor hub in Beibei District, with the sensor market reaching RMB 20 billion by 2025

 On July 13, Jiangfeng Electronics issued an announcement stating that the company issued shares to Gongchuang Lianying and paid cash to purchase 100% of the equity of Silverac Stella (Cayman) Limited (hereinafter referred to as the "target company") and raise supporting funds and related transactions.

This is the second time that Jiangfeng Electronics has acquired Silverac Stella. Its previous acquisition was rejected by the Merger and Reorganization Committee of the China Securities Regulatory Commission. In the article "Why did Jiangfeng Electronics, the leader of A-share target materials, fail in its 1.6 billion acquisition?", Jiwei.com also made a detailed analysis of the reasons for Jiangfeng Electronics' acquisition failure, and believed that the fairness of the asset pricing of the target asset at a premium of 3 times was questioned.

This time, Jiangfeng Electronics adjusted its merger and acquisition plan again. According to the adjustment plan, in terms of pricing, before the adjustment, the transaction price for Jiangfeng Electronics' acquisition of 100% of Silverac Stella's equity was 1.6 billion yuan, of which the listed company paid 1.27 billion yuan in shares, accounting for 79.40% of the total transaction amount; and paid 330 million yuan in cash, accounting for 20.60% of the total transaction amount.

The adjusted plan is that the transaction price for Jiangfeng Electronics to acquire 100% of the equity of Silverac Stella is RMB 146,094.52 million, of which Jiangfeng Electronics pays RMB 113,094.52 million in shares, accounting for 77.41% of the total transaction amount; and pays RMB 330 million in cash, accounting for 22.59% of the total transaction amount.

In terms of performance commitment compensation, before the adjustment, Gongchuang Lianying and Mr. Yao Lijun promised that if the target assets of this reorganization are delivered within 2020, the net profit realized by the target company in 2020, 2021, 2022 and 2023 will not be less than US$1.1674 million, US$6.0795 million, US$21.4772 million and US$25.4863 million, respectively; if the target assets are delivered within 2021, the net profit realized by the target company in 2021, 2022, 2023 and 2024 will not be less than US$6.0795 million, US$21.4772 million, US$25.4863 million and US$27.2936 million, respectively.

The adjusted plan shows that Gongchuang Lianying and Mr. Yao Lijun promised that if the target assets are delivered within 2020, the net profit of the target company in 2020, 2021, 2022 and 2023 will not be less than US$1.0672 million, US$6.0018 million, US$21.1311 million and US$24.8249 million, respectively; if the target assets are delivered within 2021, the net profit of the target company in 2021, 2022, 2023 and 2024 will not be less than US$6.0018 million, US$21.1311 million, US$24.8249 million and US$26.4643 million, respectively.

In fact, the promised net profit is far lower than the current actual net profit.

Data shows that Soleras USA Holdings' net profit attributable to shareholders after deducting non-recurring items in 2017, 2018, and January to August 2019 was RMB 34.6471 million, RMB 46.1546 million, and RMB 43.3987 million, respectively, but the promised net profit is far lower than the current actual net profit level.

The fact that the performance of the bet is lower than the actual net profit may be related to the trust loan of Gongchuang Lianying. On July 11, 2019, Gongchuang Lianying and Zhongyuan Trust signed the Trust Loan Contract. Gongchuang Lianying loaned 800 million yuan to Zhongyuan Trust with an annual interest rate of 8.28% and a total loan term of 60 months. After the lock-up period of the listed company shares obtained by Gongchuang Lianying through this transaction expires, it will repay the above trust loan of Zhongyuan Trust by reducing its holdings.