The "third echelon of the pig industry" has also begun to sell off assets and return funds. Zhenghong Technology and Tianyu Ecology, listed pig companies, recently announced that they will transfer the equity of their subsidiaries or their valuable shares.
In the past, Zhengbang Technology sold its assets and took off its hat after reorganization, and after Aonong Biotechnology and Tianbang Food took the initiative to sell their subsidiaries and moved towards reorganization, will the "third echelon of the pig industry" follow in their footsteps? How long will it take for the "reshuffle" of the pig industry to end?
The "shuffle" continues! There are also pig companies selling assets
The data map shows that the staff is patrolling the fence on a regular basis. (PHOTO COURTESY OF CNSPHOTO)
The "third echelon" also began to sell assets
At the end of June, two listed pig companies coincidentally sold assets to return funds: Zhenghong Technology transferred 100% equity of a feed subsidiary for 9.44 million yuan, and Luo Weiguo and Shi Dongwei, the controlling shareholders of Tianyu Ecology, tried to withdraw 122 million yuan through the transfer of 7.58% equity.
According to industry statistics, according to the number of listed pig enterprises slaughtered, listed pig enterprises can be divided into three echelons:
The first echelon is enterprises with an annual slaughter of 5 million to 10 million pigs, or even more than 10 million, such as Muyuan shares, Wen's shares, New Hope and Zhengbang Technology before the reorganization.
The second echelon is the enterprises that slaughter 1 million to 5 million pigs per year, such as Tang Renshen, Jin Xinnong, Tianbang Food, Aonong Biology, etc.
The third echelon is the enterprise with less than 1 million pigs slaughtered annually. In 2023, Zhenghong Technology will sell a total of 211,100 live pigs, and Tianyu Ecology will sell a total of 336,000 live pigs.
Up to now, three listed pig companies, Zhengbang Technology, Aonong Biotechnology and Tianbang Food, which are in the first echelon and the second echelon, have entered the reorganization procedure due to the rupture of the capital chain. Before the reorganization, these three pig companies all tried to recoup funds by selling assets, and it may be difficult for Zhenghong Technology and Tianyu Ecology to completely alleviate their cash pressure by selling assets this time.
According to the financial report, Zhenghong Technology will lose 140 million yuan in 2023 and has lost money for three consecutive years. As of March 2024, the company has liabilities of approximately $360 million. The situation of Tianyu ecology is also not optimistic, with a cumulative loss of 1.146 billion yuan in four years.
A reporter from China Business Daily called Zhenghong Technology and Tianyu Ecological Securities Department as an investor, and the other party said that the price of live pigs has been low for a long time, although pig prices have rebounded slightly in recent days, but I don't know how long it can last. In the case of the overall loss of the pig industry, the company's pig business goal is still to reduce losses.
Will it follow in the footsteps of its predecessors?
Zhengbang Technology, Aonong Biotechnology and Tianbang Food have all embarked on the road of reorganization, will the "third echelon" follow in their footsteps?
Investors who have participated in the research of a number of listed pig enterprises for many times told reporters frankly that the pig industry has been in a downturn for a long time, and corporate funds are extremely tight. At present, enterprises continue to refresh the bottom line of pig costs, and the news of rising pig prices continues, which makes the pig industry once again the focus of attention in the capital market. In particular, small-capitalization pig enterprises are very likely to be concerned by institutions with strong financial strength and peers who want to expand their scale and have cash reserves. Through reorganization, finding a "backer" is an effective path for small-capitalization pig enterprises to get out of the bottom of this round of pig cycle.
On the first trading day (July 1) after announcing the asset sell-off, as of the morning close, Zhenghong Technology's share price rose 2.82%, and Tianyu Ecology's share price rose 1.49%.
The reporter learned from industry insiders that Zhenghong Technology is also looking for a "new financier", and if it can be found, it may take the initiative to apply for reorganization. The reporter asked Zhenghong Technology for verification, but as of press time, no reply has been received.
Through this transfer of equity, Tianyu Ecology has found someone to "take over". According to the announcement, Luo Weiguo and Shi Dongwei, the controlling shareholders of Tianyu Ecology, plan to transfer 22 million unrestricted tradable shares to Shenzhen Zeyuan Private Securities Fund Management Co., Ltd. (hereinafter referred to as Shenzhen Zeyuan Private Equity) at a price of 5.562 yuan per share, in order to return 122 million yuan.
Shenzhen Zeyuan Private Equity said that the purpose of the transfer of Tianyu Ecological shares is to manage the assets of the shares after the transfer, bring returns to the private investment fund client, and do not seek control over the listed company.
It should be noted that this 122 million yuan of funds may be a drop in the bucket for the financial pressure currently faced by Tianyu Ecology. The staff of Tianyu Ecological Securities Department said that the company will not rule out the possibility of trying various financing channels in the future.
Tianbang Food: Zhang Banghui pledged another 30 million shares
On June 26, Tianbang Food issued an announcement, announcing that it had recently received an announcement from Zhang Banghui, the controlling shareholder of the company, on equity pledge. According to the announcement, the number of pledged shares is 30 million shares, accounting for 9.1% of its shares and 1.35% of the company's total share capital.
Up to now, Zhang Banghui currently holds 3297.9 million outstanding shares of the company, accounting for 14.84% of the company's total share capital, and has pledged 158 million shares, accounting for 47.91% of his shares and 7.11% of the company's total share capital.
Tianbang Food said that Zhang Banghui, the controlling shareholder of the company, has good credit status, has good repayment ability, and the pledge rate remains at a relatively healthy level. As of the disclosure date of this announcement, there is no risk of liquidation or forced transfer of the shares pledged by the company's controlling shareholder, and this pledge will not lead to a change in the actual control of the company, and will not have an impact on the company's production and operation and corporate governance.
Aonong Biotech: There are 3 potential investors who meet the recruitment conditions for reorganization investment
On June 26, Aonong Biotech issued the "Announcement on the Progress of the Company's Pre-reorganization and Risk Warning (4)", after preliminary review, the final three intended investors met the conditions for the reorganization investment recruitment, and the company is currently actively cooperating with the intended investors who have passed the preliminary review to carry out due diligence and reorganization investment plan negotiations on the company, and the three intended investors have submitted preliminary reorganization investment plans in accordance with the requirements of the interim administrator.
The company's management is confident in the current reorganization and pre-reorganization work, and the company will continue to actively promote the reorganization related work, introduce industrial investors who can form a good enabling effect with the company's existing industries, and systematically solve the liquidity problems faced by the company, so that the company can return to the track of healthy and sustainable development. The Company will disclose the progress of the reorganization in a timely manner and warn of the relevant risks in accordance with the requirements of relevant laws and regulations, and there is still uncertainty about whether the Company's reorganization can be successful, so investors are advised to pay attention to the investment risks.
The "reshuffle" of the pig industry continues
There is speculation that Zhengbang Technology has been reorganized and combined with twins, and the "third echelon" pig enterprises may join forces with their peers to integrate high-quality assets. However, there are also listed pig executives to reporters denied this view, which said that at present, the head of the pig enterprises in the energy to reduce costs, expand the scale, the integration of assets is out of the bottom of the cycle to consider.
The hog futures price is the prediction signal of the spot price in the capital market. On June 24, the main hog futures contract 2409 has fallen to 17,400 yuan/ton, equivalent to a spot price of about 8.7 yuan/catty. The 2503 contract, which represents a more long-term forecast, fell to 15,950 yuan/ton, equivalent to a spot price of about 7.97 yuan/jin. This may also mean that the capital market is hardly optimistic about the pig market.
Huachuang Futures analysts believe that after the recent decline in pig prices, although the breeding end resists the low price of slaughter pig sentiment is strong, but the overall supply of the pig market is still sufficient, in addition, the terminal consumption is in the cyclical off-season, which may inhibit the upside of pig prices.
For pig enterprises, the difficulty of financing pig industry is a real problem. Some analysts of investment institutions believe that under the new policy of the capital market, investment institutions will pay more and more attention to their own "hematopoietic" ability of pig enterprises, and the outstanding advantages of cost reduction and efficiency increase are the head pig enterprises, and the financing pressure faced by small-capitalization pig enterprises may continue.
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Source: China Business Daily, corporate announcements, etc
Editor: Wang Shihong