Text | AI Finance & Economics Zhou Xiangyue
| Zhang Shuo
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With the lifting of the ban on the restricted sale of 100 billion yuan of valuable shares, the 279 million restricted shares of Yu Renrong, the richest man in China's chips, have also ushered in the opportunity of "paper gold" to become "real money and silver".
On August 31, 607 million restricted shares of Weier Shares (accounting for about 70.24% of the total share capital) were officially listed and circulated, with a market value of 106.335 billion yuan, which is second only to SF Holdings in the scale of lifting the ban during the year.
It is reported that the restricted shares that have been lifted this time include two parts: the initial restricted shares and the fixed increase restricted shares.
Among them, the initial restricted shares are 279 million shares held by Yu Renrong, the controlling shareholder and actual controller of the company, calculated by the closing price on August 28, the trading day before the lifting of the ban, involving a market value of about 48.988 billion yuan, and the fixed increase restricted shares are 327 million shares of the 44 shareholders involved in the fixed increase a year ago.
Affected by the lifting of the ban, on August 31, the stock price of Weier shares declined, closing at 167.83 yuan / share, a decline of 4.27%. Subsequently, the stock price gradually recovered and continued to rise, as of the close of trading on September 4, the stock price closed at 187.1 yuan / share, up 0.53%, with a total market value of 161.575 billion yuan. According to this calculation, Yu Renrong's stock market value is about 52.286 billion yuan.
It is worth mentioning that a year ago, the market value of Weier shares was only 20 to 30 billion yuan, and Yu Renrong's net worth was only more than 10 billion yuan. In just one year, Weier shares and Yu Renrong have counterattacked as the largest "dark horse" in chip listed companies.
(Source: Weier shares official WeChat public number - Howey Group)
01 By selling electronic components to make a fortune, the company's listing wealth soared
In the field of semiconductors, the 85th level of the Radio Department of Tsinghua University is a special existence.
According to incomplete statistics, more than ten founders or executives in various semiconductor chains, including Zhao Weiguo, founder of Tsinghua Unigroup, Shu Qingming, one of the founders of Gigabit Innovation, Feng Chenhui, co-founder of Zhuosheng Microelectronics, Zhao Lixin, founder of Geke Microelectronics, and Zhao Lidong, founder of Flint Technology, are all students of this level.
Yu Renrong is also one of these self-proclaimed EE85 Class of 85 alumni.
According to public information, Yu Renrong was born in 1966 in Ningbo, Zhejiang Province, and was admitted to the Radio Department of Tsinghua University in 1985. In an article published by the TEU Electronics Department Alumni Association (Tsinghua Alumni Association Electronic Engineering Department Branch), Yu Renrong once received such an evaluation - in the eyes of his classmates, "Lao Yu" has always been an extremely intelligent person, "he is extremely sensitive to the judgment of the market."
It has been reported that in his freshman year, Yu Renrong once played mahjong all night, and then at 8 a.m. the next morning, he went to participate in a school-wide math competition and won the first prize. In addition to studying, he often does some "small business", such as taking Haidian's rolls to Baoding to sell, making some small money, and successfully making himself a richer person among his classmates.
After graduating from the Department of Radio at Tsinghua University, Yu Renrong joined inspur group as an engineer in 1990. That year, Inspur had just developed the world's first Chinese pager, although it had not yet reached its future glory, but it was also a star enterprise in the IT field at that time, and the momentum was rapid.
But after only two years in Inspur, Yu Renrong went to Hong Kong Longyue Electronics, a company whose main business is to distribute electronic components as an agent, as a sales manager in its Beijing office, and did it for 6 years. By February 1998, when Yu Renrong left Hong Kong Longyue Electronics, he was already familiar with the way of electronic component agency distribution.
Therefore, 32-year-old Yu Renrong set up his own portal, founded Beijing Huaqing Xingchang Science and Trade Co., Ltd., and started the old business - electronic component distribution.
With a flexible brain and a familiar path, Yu Renrong's business soon became prosperous, but at best he was a self-employed person with a larger business.
According to the "International Electronic Business Intelligence" magazine, Yu Renrong initially just wanted to "earn a few million to his parents, live a little better", but later found that the electronic components industry has a good momentum. Coincidentally, in 2003, he received guidance from a senior executive of the supplier, NASDAQ-listed ON Semiconductor, so he began to adjust his business ideas, in addition to normal supply, he also began to provide equipment solutions.
After making up his mind, he borrowed some money from his friends in the circle, began to recruit, set up points across the country, and cooperated with a large number of emerging design companies, especially mobile phone design companies, including DXN Wireless, one of the largest mobile phone software and machine design suppliers in China today.
By 2006, Yu Renrong had become very famous in the field of electronic components distribution, becoming the largest distributor in Beijing.
With the upward momentum of development, Yu Renrong took advantage of the trend to upgrade his business in 2007 and established Weier Shares in Shanghai, mainly engaged in the design and sales of semiconductor products such as semiconductor discrete devices and power management ICs, of which Yu Renrong invested 4 million yuan and held 80% of the shares.
Considering that if we follow the path of endogenous growth of the enterprise, the career leap of Weier shares may have to wait for many years, Yu Renrong decided to choose the parallel route of endogenous growth and mergers and acquisitions. From 2013 to 2015, he launched several acquisitions, and the results were good. Weier shares also quickly won the recognition of domestic mobile phone manufacturers such as ZTE, Xiaomi, and Lenovo in the field of consumer electronics.
On May 4, 2017, Weir shares were listed on the Shanghai Stock Exchange. At this time, it was only 10 years before the establishment of Vail shares.
In the first half of the year after the listing, the stock price of Weir shares continued to rise, all the way from 9.82 yuan / share to more than 40 yuan / share, but in the following more than a year, the stock price of Weir shares slowly fluctuated and declined, and by the beginning of 2019, the share price per share was about 30 yuan.
The listing of Weier shares has also brought Yu Renrong a lot of wealth, and he ranked 686th and 354th in the Hurun Rich List in 2017 and 2018 with a net worth of 6 billion yuan and 10 billion yuan.
02 "Snake Swallowing Elephant" acquired Howey Technology, and the market value rose by more than 100 billion yuan a year
What really makes Weier shares a "dark horse" worth hundreds of billions of dollars is the merger and acquisition of Beijing Howey, and Beijing Hearai's wholly-owned subsidiary is image sensor chip giant Omni Vision (OV).
According to public information, Howey Technology was founded in 1995 and listed on the NASDAQ in December 2000, and was once known as "Apple's mobile phone camera chip supplier".
Hearey Technology has developed the world's first single-chip color CMOS (chip applied to digital photography) image sensor, and has been the boss of the high-end image sensor chip for a long time.
With the rise of Sony and Samsung, the market share of Howey Technology has gradually been eroded and has fallen to the third place in the industry. Howey Technology shifted its focus to the Chinese market and sought privatization, eventually "selling" itself to CITIC Capital, Huachuang Investment and Kingstone Investment for US$1.9 billion in 2016, becoming a subsidiary of Beijing Howey.
The fate of Weier shares and Howey Technology dates back to 2017.
On June 3, 2017, only one month after receiving the capital support brought by the listing, Weier Co., Ltd. could not wait to announce that it was planning a major event, and on September 5 of that year, it announced that it had signed a framework agreement on major asset restructuring with beijing howey shareholders to acquire 86.4793% of the equity of Beijing Omniverg.
But just three weeks later, the acquisition was terminated by opposition from Zhuhai Rongfeng, one of Beijing's shareholders at the time.
However, Vail shares did not give up. In August 2018, Weier co., Ltd. and Beijing Howey continued the frontier, and announced that it intends to purchase 85.53% of the equity of Beijing Omniverg, 42.27% of the equity of Sibylco and 79.93% of the equity of Vision By issuing shares. Prior to this, Shaoxing Weihao, controlled by Yu Renrong, had been promoted to the largest shareholder of Beijing Howey, holding 17.58% of the shares.
The merger was finally approved by the CSRC in May 2019 and conditionally approved, and the transaction consideration of the three mergers and acquisitions was 13.023 billion yuan, 234 million yuan and 255 million yuan respectively at the issue price of 33.88 yuan per share, totaling 13.512 billion yuan.
Judging from the size of the two companies at that time, the total assets of Beijing Howey were almost 5 times that of Weier shares, and the net assets were almost 8 times, which was a typical "snake swallowing elephant" acquisition.
Facts have proved that this acquisition is worthwhile, not only further broadening the business layout of Weier shares, but also becoming a fulcrum to leverage the performance and stock price of Weir shares.
According to the data, since May 2019, the stock price of Weier shares has risen from the lowest 38.47 yuan / share to the highest 252.73 yuan / share on July 14, 2020, a full increase of more than 5 times, the market value has risen by more than 11 times, and the highest time reached 218.252 billion yuan.
Although the stock price of Weir shares has rebounded in the past two months, it is still at a high level. Based on the stock price and market value on September 1, Weir shares have risen by more than 3 times and 7 times compared with the stock price and market value of a year ago, respectively, and are already the chip stocks with the highest value in the A stock market.
In terms of performance, the financial report shows that Weier shares achieved revenue of 13.632 billion yuan in 2019, an increase of 40.51% year-on-year, and revenue has increased significantly for more than 5 consecutive years. In 2018, its growth rate even reached 303.25%; the net profit attributable to the mother was 466 million yuan, an increase of 222.14% year-on-year.
In the first half of 2020, Weier co., Ltd. achieved revenue of 8.043 billion yuan, an increase of 41.02% year-on-year; the net profit attributable to the mother was 990 million yuan, an increase of 1206.17% year-on-year, and the deduction of non-net profit was directly increased by nearly 50 times.
For the reasons for the sharp rise in performance, Weier co., Ltd. said in the semi-annual report that this is mainly due to the acquisition of Beijing Howey and Sibiko, which has increased the layout of cmOS image sensors in the main business, making the company's semiconductor design overall technical level rapidly improved, and obtained high-quality customer resources in the fields of smart phones, security, automotive, and medical treatment.
It is worth mentioning that Yu Renrong's net worth has already risen with the soaring stock price of Weier shares, reaching 70.6 billion yuan at the highest time. In the "2020 Hurun Global Rich List" released on February 26, Yu Renrong ranked 281st with a net worth of 50 billion yuan, becoming the well-deserved richest chip man in China.