Ahead of it, is it delisting, bankruptcy reorganization, or?
Hengkang Medical, one of the pioneers of the "pharmaceutical merger and acquisition of hospitals" model, has encountered a debt crisis and is on the verge of delisting in the past two years, ushering in a new turnaround in the near future. On the evening of December 8, it announced that Beijing New Mileage Health Industry Group Co., Ltd. (hereinafter referred to as "New Mileage Health") became the restructuring investor of Hengkang Medical.
New Mileage Health is a wholly-owned subsidiary of New Mileage Hospital Group Co., Ltd. (hereinafter referred to as "New Mileage Group"), one of the largest general hospital groups in China, as of November 2021, New Mileage Group holds more than 30 secondary and above hospitals, including 6 tertiary hospitals, with a total number of beds of about 20,000 beds.
Li Shui, president of Ganxi Cancer Hospital under Hengkang Medical, said: As the president of a grass-roots hospital, including many hospital employees, the criterion for choosing a reorganization investor is to hope that the investor is a long-term industry, and the hospital can have a future, rather than restructuring for the sake of restructuring, and only focus on secondary market returns.
From changing its name to "Hengkang Medical" in 2013 to get involved in medical services, to introducing a hospital group as a restructuring investor in 2021, in the past decade, Hengkang Medical has risen and fallen, and has gone through a cycle of "pharmaceutical companies acquiring hospitals" model, in this cycle, pharmaceutical companies buy hospitals, from rushing to return to rationality.
"Private medical first stock" from widely sought after to the brink of delisting
Hengkang Medical, formerly known as "Gansu Duyiwei Biopharmaceutical Co., Ltd.", owns China's well-known proprietary Chinese medicine "Duyiwei Capsule", which was listed on the Shenzhen Stock Exchange in 2008, and its actual controller Que Wenbin has been listed as the richest man in Gansu Province by the Hurun Rich List for 9 consecutive years since 2009.
In 2013, Hengkang Medical changed its name to "Hengkang Medical Group Co., Ltd.", taking medical services as one of the core industries, and planning the layout of "tumor treatment and high-end obstetrics and gynecology". This year is the end of the golden decade of recognized "public hospitals", the aging trend of China's population is becoming increasingly severe, various capitals have a strong interest in medical services, and pharmaceutical companies are eager to acquire hospitals.
From 2014 to 2017, Hengkang Medical acquired hospitals on a large scale, and according to media reports, it has acquired 19 hospitals and medical institutions, including the third hospital Dalian Wafangdian Third Hospital (hereinafter referred to as "Wasan Hospital"), a tertiary hospital, and Xuyi County Traditional Chinese Medicine Hospital in Jiangsu Province, which was upgraded to a tertiary hospital in 2021. As the forerunner of "pharmaceutical companies acquiring hospitals", it was enthusiastically praised by the capital market as "the first private hospital stock", with a market value of more than 30 billion yuan at one time, and also achieved the glory of Que Wenbin's position of "the richest man in Gansu" for nine years.
During this period, Hengkang Medical initiated two merger and acquisition funds, Jingfu Huayue and Jingfu Huacai, and designed a special structure for them, investing 138 million yuan to control 1.224 billion yuan of funds; subsequently used the two funds to acquire Lankao County People's Hospital, Lankao Fuyang Hospital, Lankao Oriental Hospital and Siyang County People's Hospital. The performance of these four hospitals has been incorporated into Hengkang Medical, and in 2020, their combined revenue will account for 35% of Hengkang Medical's total revenue.
Hengkang Medical uses financial leverage to actually invest 138 million yuan to acquire four hospitals, and can also incorporate them into the statements of listed companies, which is the epitome of Hengkang Medical's aggressive expansion.
2018 was the turning point for Hengkang Medical, which showed its first loss since its listing, with a loss of more than 1.4 billion yuan in that year and a loss of more than 1.9 billion yuan in 2019. In this regard, the announcement said, "The company's performance loss is mainly due to the company's higher financial expenses, as well as the liquidated damages generated after the maturity of the two buyout funds Jingfu Huayue and Jingfu Huacai." ”
For two consecutive years of huge losses, Hengkang Medical was delisted risk warning, in May 2020, the stock price fell below 1 yuan, the market value shrank to 1/10 of the peak. At the same time, When Que Wenbin borrowed debt, he pledged most of the Hengkang Medical stocks he held, and his personal capital chain was also quite tight.
In July 2020, Huabao Trust took Hengkang Medical to court, demanding compulsory liquidation of the two buyout funds and payment of about 900 million yuan in partnership interest acquisitions and overdue interests.
As of November 2021, Hengkang Medical still holds 11 hospitals, with nearly 8,000 beds and nearly 10,000 employees. This once brilliant medical group still has qualified and large-scale assets at this time. Ahead of it, is it delisting, bankruptcy reorganization, or?
You sing me out
New Mileage intervened to solve Hengkang's debt crisis
Hengkang Medical's predicament soon attracted several large groups, which intended to help Hengkang solve its debt problems in order to gain its equity and even a controlling stake.
Although at this time, pharmaceutical companies and other listed companies are not as enthusiastic about acquiring hospitals as they were in 2015 and 2016, when there were announcements of listed companies to acquire hospitals, the stock price rose in response. However, Hengkang Medical's hospitals are both large and qualified, and they are still quite attractive.
The first to appear is still the pharmaceutical company.
On December 2, 2020, Hengkang Medical announced that Que Wenbin signed the Restructuring Investment Cooperation Framework Agreement with Shenzhen Haiwang Group Co., Ltd. (hereinafter referred to as "Haiwang Group") and Minmetals Jintong Equity Investment Fund Management Co., Ltd. (hereinafter referred to as "Minmetals Jintong"), stipulating that "after Neptune Group resolves the debts of Jingfu Huayue and Jingfu Huacai, Que Wenbin entrusts the voting rights corresponding to 19.90% of the shares of Hengkang Medical held by him to Haiwang Group". Neptune Group is a large-scale comprehensive enterprise group with pharmaceutical industry and biological engineering as the core, and has owned a listed company Neptune Biotech.
Yibai Pharmaceutical said it intends to transfer two-thirds of the fund's priority shares from Huabao Trust. However, Yibai Pharmaceutical soon announced its withdrawal from the bidding.
On December 29, 2020, New Mileage Group announced that it had acquired all of the priority shares of the two buyout funds. Guan Hengye, vice president of New Mileage Group, said: "At that time, New Mileage spent more than 800 million yuan to buy all the priority shares of the two funds with sufficient strength and sincerity, hoping to achieve the company's non-delisting by stopping the liquidation of the two buyout funds, exempting Hengkang Medical from penalty interest and injecting high-quality assets. Since then, New Mileage has not proposed to liquidate the two funds, thus avoiding the risk of delisting caused by the auction of the core assets of the listed company. ”
On December 30, Hengkang Medical announced that Neptune Group paid 135 million yuan to Minsheng Trust to purchase the intermediate shares of the two funds.
The total size of the two funds is 1.224 billion yuan, and from the perspective of capital contribution, New Mileage Health has shown stronger financial strength and sincerity in solving the debt crisis of Hengkang Medical.
On February 9, 2021, Hengkang Medical announced that the previous agreement with Neptune Group was terminated. Que Wenbin signed a new "Restructuring Investment Cooperation Agreement" with New Mileage Health and Minmetals Jintong. Several parties agreed that the new mileage would obtain the shares and control of the listed company by subscribing to the capital reserve of the listed company and increasing the share capital. The announcement pointed out that this move is to avoid the direct delisting of Hengkang Medical or the occurrence of bankruptcy liquidation.
Guan Hengye said: "If this agreement is implemented and hengkang medical restructuring is successfully completed, the debt crisis of listed companies can be completely resolved." ”
However, this agreement has not been implemented. In July 2021, the Gansu Longnan Intermediate People's Court ruled to accept a creditor's application for the reorganization of Hengkang Medical, and in August appointed Beijing JunHe Law Firm and Gansu Jiezhou Law Firm as the administrators of Hengkang Medical.
Hengkang Medical enters the reorganization process new mileage to become a restructuring investor
In September 2021, Hengkang Medical Manager openly recruited and selected restructuring investors. New Mileage Health and Zhongmin Medical Investment Co., Ltd. (hereinafter referred to as "Zhongmin Medical") applied for the election and submitted their own restructuring investment plans.
The addition of Zhongmin Medical has added new variables to whose reorganization rights Hengkang Medical will be spent.
Investors who are active in Hengkang Medical Stock Bar generally believe that the new mileage health is a safe bet before the results are released. In addition to investing more than 800 million yuan at the end of 2020 to buy all the priority shares of the two funds, New Mileage Health has been actively trying to solve the crisis of Hengkang Medical.
On March 9, 2021, Hengkang Medical and New Mileage Health signed the Designated Repurchase Agreement, designating New Mileage Health to transfer part of the intermediate share of Jingfu Huayue and Jingfu Huacai.
On March 29, 2021, Hengkang Medical was re-elected to the board of directors, Lin Yanglin, chairman of New Mileage Health, was elected as the chairman, and Liu Jun, general manager of New Mileage Health Financial Management Department, served as the financial director. The new board of directors has taken a series of measures to promote the stability and development of Hengkang Medical, and in the first three quarters of 2021, the operating income increased by 10.78% year-on-year.
On December 1, 2021, the reorganization investor selection and review meeting was held, and the representatives of creditors, shareholders, employees and experts participated in the voting.
Li Shui, president of Ganxi Cancer Hospital, was entrusted by Wat San Hospital to vote at the review meeting, which is the first tertiary hospital acquired by Hengkang Medical and the largest ordinary creditor confirmed by Hengkang Medical Administrator.
After carefully reviewing the two reorganization plans, Li Shui judged: "The reorganization plan of the new mileage, including the plan for creditors and the plan for the development of the hospital, has both a strategic vision, a grounded atmosphere, and a relatively strong operability." Especially in the future development of hospitals, it can be seen that the new mileage has the ability to manage large hospitals, including the top three hospitals, I vote on behalf of the Watsan Hospital, I am also the president of the grass-roots hospital, seeing this plan will make me confident. It is believed that under the leadership of the new milestone, Hengkang Medical may embark on a higher height of development. ”
Li Shui said: "We have also contacted other institutions before, many of their solutions tend to capital operation, the new mileage is really doing medical treatment, so we tend to choose a new mileage." As the president of the grass-roots hospital, including many employees of the hospital, the criterion for choosing the reorganization investor is to hope that the hospital has a future, rather than restructuring for the sake of restructuring, only to solve the immediate problems, and pay more attention to the benefits of the secondary market, so that Hengkang Medical will still go far after the reorganization. ”
The results of the selection meeting were released, and New Mileage Health became the restructuring investor of Hengkang Medical. The restructuring plan of the new mileage health is unknown.
However, from Hengkang Medical's previous announcement, it can be inferred that it signed the "Reorganization Investment Intention Agreement" with New Mileage Health, and agreed that "if New Mileage is finally determined as a reorganization investor in the hengkang medical investor selection process, Hengkang Medical will make a draft reorganization plan based on the investment plan provided by new mileage." "The agreement includes a bond settlement arrangement for Hengkang Medical, an adjustment arrangement for the rights and interests of New Mileage Health as an investor, and a follow-up business plan for Hengkang Medical after the reorganization."
At present, under the supervision and guidance of Longnan Intermediate Court, Hengkang Medical Administrator is negotiating with New Mileage Health to sign relevant documents such as the reorganization investment agreement, and continues to promote the work related to bankruptcy reorganization. Hengkang Medical's 11 hospitals and nearly 10,000 employees are waiting for the reorganization to continue.
With the ups and downs of Hengkang Medical, Que Wenbin also went from being the "richest man in Gansu" for nine years to becoming "the richest man in Gansu". He has pledged shares to Institutions such as Northeast Securities, Hualong Securities, and Shenzhen Qianhai Shengshi Chenjin Investment Enterprise, and as Hengkang Medical's stock price rose from less than 1.5 yuan in early February this year to more than 4 yuan, these institutions auctioned the pledged shares to recover the debt.
Hengkang Medical announced on November 27 that as of the announcement date, the company's shares held by Que Wenbin had been auctioned for a total of 316.37 million shares, accounting for 16.96% of the company's total share capital. According to a shareholder of Hengkang Medical, according to the disclosure of public information, Que Wenbin's shares in Hengkang Medical will not exceed 25.6%.
*The copyright of this article belongs to the original author, if you need to reprint, please contact the original author for authorization
![After three years of collection, these pharmaceutical companies have lived better[fig]](data:image/gif;base64,R0lGODlhAQABAIAAAP///wAAACwAAAAAAQABAAACAkQBADs=)