| AI Finance agency Ishihara-ri
| Beam night
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The leading enterprises with the highest gold stock market value are saddled with human life bonds.
On July 23, the Emergency Management Bureau of Linyi City, Shandong Province, released information that in April this year, shandong gold returned to Zhuang gold mine with two deaths and one injury accident, and after the accident, the gold mine did not report it in accordance with regulations. At present, the Bureau has set up an investigation team to investigate the cause of the accident and will punish the concealment of the report.
Founded in 2000, Shandong Gold is currently the largest gold producer in China and the largest listed company in the market value of gold stocks, with a market capitalization of 91 billion yuan as of July 23, surpassing the second-ranked Zijin Mining company by 7.9 billion yuan. It is also the only mining enterprise in China with two cumulative gold production exceeding 100 tons.
Star enterprises are murdered
According to the Beijing News, the murder that occurred in April at the Shandong Gold Return Zhuang Gold Mine was when three workers fell into a 100-meter-deep shaft when replacing the wire rope of the mine shaft. The accident eventually resulted in 2 deaths and 1 injury.
After the incident, the gold returned to Zhuang Gold Mine instead of calling the 120 emergency number, but sent the injured to the hospital in other counties for treatment. The Emergency Management Bureau of Linyi City, Shandong Province, will punish the mine for concealing the report.
Huilaizhuang Gold Mine is located in Pingyi, Shandong Province, founded in 1992, is a modern gold mine integrating mining, selection and smelting built and developed during the "Eighth Five-Year Plan" period, and is a state-owned second-large enterprise. Its state-owned shareholder is the People's Government of Pingyi County, Shandong Province, and the Pingyi County Finance Bureau holds and manages the county's state-owned assets and state-owned equity on behalf of the Pingyi County Government.
On June 7, 2009, Shandong Gold and the state-owned shareholders of Huilaizhuang Gold Mine signed the "Equity Transfer and Capital Increase And Share Expansion Agreement" to acquire a total of 70% of the equity of Huilaizhuang Gold Mine held by it at a price of RMB516 million from its own funds.
For many years, Huizhuang Gold Mine has been rated as "Yimeng Meritorious Enterprise" by Linyi Municipal Party Committee and Municipal Government, and was awarded the title of "Star Enterprise" by the National Gold Association. In 2005, the mineral gold was 2.06 tons, and the profit and tax was 156 million yuan, creating a good result of a single gold mine achieving the first profit and tax in the country. When it was acquired by Shandong Gold in 2009, the assets of The Huizhuang Gold Mine totaled 155 million yuan and the net assets of 77 million yuan. In April 2009, the cumulative output was 17.1 tons, and the profit and tax was 866 million yuan.
In 2019, before the murder, Shandong Gold Return Zhuang Mining Co., Ltd. changed the senior management level on a large scale. The legal representative was changed from Li Tao, vice chairman of the board of directors of Shandong Gold, to Xiao Kunrong, and the position of general manager was also changed from Wang Shuchun to Xiao Kunrong, and Wang Deying was added as the chairman of the supervisory board.
Public information shows that in previous spot checks, Shandong Gold Return Zhuang Mine was required to "stop production" in 2015 and was "urged to speed up rectification and pass" in 2016. In two consecutive inspections in March and May 2018, the results were "good". However, on October 23, 2017, the company was administratively punished by the State Taxation Bureau of Pingyi County, Linyi City.
The most aggressive gold gangster in A shares
In 2003, Shandong Gold landed on the A-share market at an issue price of 4.78 yuan per share. At that time, the company owned only one second-tier mine in Laizhou, Shandong. But since then, Shandong Gold has planned a total of 19 acquisitions and is known as the most aggressive gold gangster in A-shares.
Since its listing, Shandong Gold has had acquisition plans every year. Through mergers and acquisitions, Shandong Gold has acquired a number of gold mines such as Jiaojia Gold Mine, Sanshan Island Gold Mine, Linglong Gold Mine and Yinan Gold Mine, including prospecting rights and mining rights of minerals. Among them, the cumulative gold production of Jiaojia Gold Mine and Linglong Gold Mine exceeded 100 tons. According to China's mineral gold production in 2017, Shandong Gold has become the largest gold producer in China, with a market share of 6.6%.
According to statistics, Shandong Gold has 13 gold mines, 12 in China and 9 in Shandong. Among them, 4 are ranked among the top 10 gold mines in China. Shandong Gold has also expanded its business overseas. In 2017, it teamed up with world gold giant Barrick Gold to acquire a 50% interest in the Belladero project for US$960 million. It is the largest gold mine in Argentina and the second largest in South America, and the largest overseas gold mine currently operated by domestic gold companies.
The reason why Shandong Gold continues to expand its gold reserves through mergers and acquisitions is that it does not have an advantage in this regard compared to other mining industries. As of March 31, 2018, shandong's total gold reserves were only about 10.901 million ounces, while as of the end of 2017, Zhaojin Mining's recoverable gold reserves were about 16.98 million ounces, and Zijin Mining's gold resource reserves were 1320.07 tons (about 46.5641 million ounces), more than four times that of Shandong gold.
The pace of mergers and acquisitions has not stopped. On June 22, 2019, Shandong Gold announced that the company intends to acquire 100% of the equity of Arnica Financial Holdings from the major shareholder Shandong Gold Group for 2.27 billion yuan, and after the completion of the transaction, the company will hold 100% of the equity of Arnica Financial Holdings.
Aggressive M&A strategies have led to a significant increase in financial expenses and have dragged down the company's performance. Shandong Gold's 2018 annual report shows that its financial expenses reached 792 million, a substantial increase of 58% year-on-year. The Tianfeng Securities report speculates that the increase in finance expenses is due to an increase in M&A borrowing, in addition to a currency loss of 116 million yuan in 2018.
In September 2018, Shandong Gold officially landed on the Hong Kong stock market, issuing a total of 328 million shares and raising US$614 million. The funds were used to repay borrowings from the acquisition of Belladero.
In 2018, Shandong Gold became the gold enterprise with the largest annual mineral gold production in China, surpassing Zijin Mining, which once ranked first. In that year, Shandong gold production totaled 39.32 tons, an increase of 9.57% year-on-year. In 2019, the company's determined production and operation plan is gold production of 37.87 tons, which is expected to decline.
Zijin Mining has always been the object of Shandong Gold's catch-up. In 2013, Chairman Wang Jianhua, who single-handedly pursued Shandong Gold's aggressive expansion route, left his post after serving as chairman of the group for seven years. Three months later, Wang Jianhua was nominated as president of Zijin Mining.
In the days of the crazy expansion of Shandong gold, the millennium old man jumped to occupy the chief. As of July 23, 2019, the market value of Shandong Gold reached 91 billion yuan, while the market value of Zijin Mining was 83.1 billion yuan.