Some people say that Yiwu people are the best at doing business. The global economic recession, rising costs, these difficulties are fair to everyone, Yiwu people will definitely find a way.
However, after Zhou Xiaoguang, the richest woman in Zhejiang and chairman of Xinguang Group, the three brothers ding Zhimin, who was the second richest man in Yiwu, also fell into a debt dilemma, and the 20 billion assets of Sanding Holdings 340 million yuan of bonds defaulted, thunderstorm!
Will the second richest man in Yiwu be squandered by 1.165 million?
Ding Zhimin, chairman of Sanding Holding Group
In 2011, Huading shares were successfully listed on the Shanghai Stock Exchange, which was the first IPO private enterprise in Yiwu, Zhejiang, and the three brothers Ding Zhimin, Ding Ermin and Ding Junmin, who were well-known in Yiwu, became the second richest man in Yiwu, and at that time, second only to the Weng Rongjin family, the chairman of "Lansha Textile", the richest man in Yiwu.
However, all this may be too much to see. On the evening of September 6, Sanding Group announced that due to multiple factors such as macro leverage reduction, bank credit contraction, and financing difficulties of private enterprises, our company's liquidity problems and debt repayment pressure were relatively large, resulting in the company's failure to repay the principal and interest of sanding holding group co., Ltd.'s public issuance of corporate bonds (phase I) to qualified investors in 2017.
The defaulted bond "17 Sanding 01" bond balance is 344 million yuan, the coupon rate is 7.5%, the coupon date is September 6, 2017, the maturity is three years, and September 6 is the resale date.
In fact, on August 29, Sanding Group was downgraded after issuing an interest payment announcement on "17 Sanding 01". On September 2, the credit rating agency and the credit rating agency jointly decided to downgrade the long-term credit rating of Sanding Holdings from "aa" to "a", and the credit rating of "17 Sanding 01", "17 Sanding 02", "17 Sanding 03" and "17 Sanding 04" from "aa" to "a", and at the same time put the company's entities and these four bonds on the rating watch list that may downgrade their credit ratings.
This time, the "joint rating" is a "divine calculation", anticipating the risks of Sanding Group in advance. Sure enough, four days later, Sanding Group triggered a default of 340 million yuan of bonds.
In 2011, Huading shares were listed
Sanding is the world's largest webbing "aircraft carrier", known as the "webbing king" in the industry, chairman Ding Zhimin once said: "This is a very partial industry in the field of knitting, with many uses, wide coverage, but the amount is very small, in theory, my daily output of 100 million people can be consumed." ”
Unlike most webbing companies that are just small factories with dozens of people, Sanding has only one webbing research and development center, with more than 200 people 10 years ago. Many people may not look at such a small product as webbing, but the three Ding Zhimin brothers have done a lot of wind and water and harvest.
However, it must be noted that industries such as webbing and nylon, after all, are traditional manufacturing industries, and their resistance to risks is weak. In recent years, as more and more competitors have entered, the development space has gradually shrunk. In the past, the profit margin of the webbing industry could usually reach more than 30%, but now it can be 5%-10% is not bad.
After taking orders, delivery after two months to collect money, but in two months, the exchange rate changes, the profit is gone; this is the "skin pain" of many traditional enterprises. In an interview ten years ago, Ding Zhimin once said that his two "magic weapons" of anti-risk :() raw materials should be imported as much as possible, and the imported materials should be settled in US dollars or letters of credit as much as possible, and the payment time should be delayed as much as possible. Second, the export of products should be settled in RMB or euros as much as possible. In doing so, the impact of the policy of reducing export tax rebates can also be minimized. However, he also believes that "the main thing is to do what you are good at." When the strength is strong, it has the right to speak"; the enterprise has no strength, the credibility is not high, and people do not buy it at all.
According to the 2018 annual report, the total assets of Sanding Holdings under the Ding Brothers are 23.334 billion yuan, the net assets are 12.784 billion yuan, the monetary funds are 1.911 billion yuan, and the bills receivable and accounts receivable are 21.711 billion yuan; in addition, the total liabilities of Sanding Holdings are 10.554 billion yuan.
Pingmei Shenma Group visited Sanding Holding Group, and the front row left 2 was Ding Ermin, executive vice chairman of Sanding
Recently, the media reported that Yiwu webbing giant Sanding owed 1.165 million yuan for the goods, and the defendant went to court, and the plaintiff company demanded that Sanding Holdings pay the payment and interest on overdue payment.
Many people wonder how tight its liquidity is due to the fact that the Annual Report shows that Sanding Group, which has more than 20 billion assets, is in court because of more than one million yuan?
According to the data, in the debt structure of Sanding Group, there are interest-bearing debts of 7.63 billion yuan and the asset-liability ratio of 45.22%; in addition, the company's monetary funds are 1.911 billion yuan, in addition to which 385 million yuan of margin is restricted funds, and the available funds are also as much as 1.526 billion yuan. Relevant financial data also show that as of the end of 2018, the total credit of Sanding Holdings Bank reached 5.358 billion yuan, and the unused credit balance was 1.888 billion yuan.
From the perspective of monetary funds, bank credit, and debt composition, although the liquidity of Sanding Group is not abundant, it is not so tight, why will it lead to a default of 340 million yuan of bonds, and it will also be involved in litigation lawsuits because of more than one million debts? Logically, it doesn't make sense!
According to financial reports, on August 27, the announcement of Huading Shares, a listed company, on the pledge of the company's controlling shareholders showed that the controlling shareholder, Sanding Holdings, held a total of 314 million shares in the company, accounting for 27.53% of the company's total share capital. Among them, 306 million shares were pledged, accounting for 97.24% of the total number of shares held by them and 26.77% of the total share capital of the company. The pledge ratio is high, and the company faces the risk of changing the control of Huading shares.
By the end of 2018, the company's ownership or use rights were restricted by a total of 7.295 billion yuan of assets, accounting for 31.26% of the total assets of the current period, and the scale of asset restrictions was large; the total debt was 8.486 billion yuan, short-term debt accounted for 61.49%, the company's liquidity was tight, and the short-term debt repayment pressure was relatively large.
Ding Zhimin, Ding Ermin brothers
On July 30, Sanding Group announced that it intends to use the property rights of Yiwu New Century Grand Hotel and Yiwu Marriott Hotel legally owned by Sanding Holdings as collateral for the debt "17 Sanding 01". However, on August 31, "Huading Shares", a listed company under Sanding Holding Group, said in the "Indicative Announcement on the Company's Self-Inspection of the Occupation of Funds by Controlling Shareholders" that the controlling shareholder, Sanding Group, has formulated a plan for the return of occupied funds, and the property rights of these two five-star hotels will be used as collateral for the occupied funds, and the relevant mortgage procedures are underway.
Sanding Group first mortgaged two hotels to the bonds to increase credit, and then rebelled and delayed the mortgage procedures, and then mortgaged to its listed companies, what is this God operation, the listed company's funds are occupied, how can the good collateral "fly"?
Some people sort out some of the reasons why Sanding is in a liquidity crisis, such as high inventory, as of the end of 2018, Sanding inventory was 1.403 billion yuan, more than double the previous year's 687 million yuan. Another example is the formation of huge goodwill in successive acquisitions, with goodwill of 1.618 billion yuan in 2018, compared with tens of millions a few years ago. In addition, buying and buying is also a big challenge to liquidity. Another factor is to invest in real estate and spend a lot of money to build the so-called "future health and leisure" project in Yiwu.
In the final analysis, the main reason why the Ding Zhimin brothers of Sanding Group are trapped in the liquidity dilemma is that there is a problem in the judgment of major corporate strategies. Two or three years ago, the Ding brothers put forward the strategy of "big finance, big capital, big industry", and the three major sectors are indispensable, and strive to be mutually integrated. Of course, the Ding Zhimin brothers also hope to disperse the risks brought by traditional main businesses such as weaving by doing hotels, finance, tourism, etc., but there is a point, such a strategy is said to be "an attempt to extend the industrial chain", it does not make sense, and the transformation is obviously risky.
"Sanding" webbing: an old dyeing machine, more than 20 workers started
Ding Ermin, chairman of Huading Company (1 from right)
Sanding Holdings, which started from the head flower trade, because in the early years wanted to try to buy and dye themselves, the Ding brothers bought a dyeing machine and started a small family workshop business. In 1994, ding zhimin, Ding Ermin, Ding Junmin three brothers founded the first industrial company, that is, the predecessor of Sanding Holding Group - Yiwu Global Belt Co., Ltd.
In the early days of entrepreneurship, starting from an old dyeing machine and more than 20 workers, soon, the "Sanding" brand webbing was famous outside. After the financial crisis in 1997, the three Ding Zhimin brothers did not flinch, but formed Sanding Weaving Co., Ltd., which is extremely critical to the future development of Sanding Holding Group.
Liu Dongmei, executive vice president of Sanding Holding Group, once introduced that the initial expansion of the terminal webbing industry was mainly based on scale expansion, and then in order to expand the product line, it began to develop to the upstream industrial chain raw material processing and nylon industry. "A production line costs hundreds of millions of yuan, which is completely different from the previous production of small commodities"; with the opening of the first factory in Beiyuan and the first and second phases of Suxi Branch, "Sanding" has gradually opened up a complete industrial chain, so that Sanding has moved towards large-scale industrial production.
Among them, in 2014, the construction of the "Wuzhou New Material" project with a total investment of 6 billion yuan made Sanding leap to a new stage of development. The "Wuzhou New Material" project enables Sanding Group to achieve "the first degree of independent innovation in technology, the first degree of advanced equipment, the first degree of process automation, and the first in product quality" in the nylon industry.
After the explosive growth of the industry in 2010, most manufacturers in the webbing industry are sparing no effort to expand production capacity, resulting in overcapacity. The three Ding Zhimin brothers, who have always had a strong sense of distress, also urgently need to seek a new path of transformation. Later, Sanding developed the Sanding Plaza project of Yiwu CBD Center and two high-end hotels, and also set up a Sanding micro-loan, and in 2015, it started the "Future Health and Leisure" project.
On August 22, the All-China Federation of Industry and Commerce released the "2019 Top 500 Chinese Private Enterprises" series of lists in Xining, Qinghai, and Sanding Holding Group ranked 358th in the 2019 "Top 500 Private Enterprises in China" and 207th in the "Top 500 Private Enterprises in China". This is the sixth consecutive year that Sanding Holding Group has been shortlisted in the list of "China's Top 500 Private Enterprises".
Ding Zhimin (1st from left) directs the construction of the project at Wuzhou Company
The entrepreneurship of the three Ding brothers began in 1985, when the obligor Ding Zhimin, who was born in 1963, started an umbrella factory, but due to the information blockage and failure to grasp the market situation, the umbrella factory was forced to stop production. At that time, the two brothers Ding Ermin and Ding Junmin, together with their father, opened a silk factory.
In 1993, Ding Zhimin ushered in a turning point in his life, when he saw that there was a great demand for making head flower decorative tapes, he set up the first processing trade company specializing in selling ribbons in the Yiwu Small Commodity Market. The following year, the three Ding brothers acquired 5.8 acres of land in Yiwu Twenty-Three Mile Industrial Zone, invested 3 million yuan, and founded Yiwu Global Belt Co., Ltd.
After the establishment of Sanding Weaving, the Ding brothers began to enter the real estate industry, and Hengding Real Estate was founded in 2002. It is worth mentioning that the Ding Zhimin brothers did not give up the industry, and in September of the same year, Huading Nylon was founded and formed the Sanding Holding Group, which is regarded as the most important leap in the history of the Ding family's operation.
In 2006, the three Ding Zhimin brothers entered the public eye, and chairman Ding Zhimin became the second richest man in Yiwu. At that time, Sanding Holdings was the largest shareholder of Huading Shares, a listed company.
Ding Zhimin Brothers and Vice Chairman of the All-China Federation of Industry and Commerce Cheng Lu (2nd from the right)
It should be said that the early Huading Nylon is a very pure typical family business, the equity structure is very simple, neither the introduction of strategic investors, nor the complex asset restructuring, and the shareholders have always been three. It was not until January 2005 that Ding Ermin signed an equity transfer agreement with Hong Kong Yongshun, and in November of the same year, Huading added a new investor, a Taiwanese Wang Junyuan. Wang Junyuan, a Taiwanese businessman, is mainly engaged in textile printing and dyeing equipment.
Later, Hong Kong Yongshun withdrew, and Yiwu Deka settled in,
Bond defaults, thunderstorms, the Ding Zhimin family's sad days seem to have just begun, diversification expansion and transformation have failed, and there are many places to reflect. Cross-border acquisitions and diversified investments, the surface scenery is actually full of hidden risks, especially the test of the capital chain.
The Xinguang Zhou Xiaoguang family, who are also rich in Yiwu, fell from the altar of the gods at once due to a debt crisis, like heaven to the abyss. Zhou Xiaoguang's Xinguang Group is also a family-controlled-led governance model, and its family plays a leading role in corporate governance. The two Yiwu rich people are almost similar to each other, and the Sanding of the Ding Zhimin family also has the crux of the capital occupation of the major shareholders of the listed company like the Zhou Xiaoguang family.
In terms of supervision, family enterprises should be real and virtual, and operate within the enterprise with institutional norms, especially listed companies, but also public enterprises, and the occupation of funds by major family shareholders is equivalent to hollowing out listed companies, and encroaching on the interests of social shareholders. It is precisely because of such governance defects that the Zhou Xiaoguang family has fallen into the debt quagmire step by step, and the problem of corporate governance is a major key point in this, which is worthy of vigilance!
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