Latest M&A! Two companies planning major restructuring! Also increasing investment...

Major asset restructuring! Ningbo Fangzheng plans to acquire 60% equity of Junpeng Communication

On the evening of April 16, Ningbo Fangzheng (300998) disclosed an announcement stating that the company is planning to purchase in cash the 60% equity interest in Fujian Junpeng Communication Technology Co., Ltd. (hereinafter referred to as "Junpeng Communication") held by Fujian Pengxin Chuangzhan New Energy Technology Co., Ltd. (hereinafter referred to as "Pengxin Chuangzhan")..

Ningbo Fangzheng stated that prior to the implementation of this transaction, the company held a 40% equity interest in Junpeng Communication, and Pengxin Chuangzhan held a 60% equity interest in Junpeng Communication. Junpeng Communication is controlled by Fang Yongjie, the actual controller of the company, and Wang Yaping's daughter, Wang Ruqi; therefore, this transaction constitutes a related-party transaction. Upon completion of this transaction, Junpeng Communication will become a wholly-owned subsidiary of the company.

According to the "Administrative Measures for Major Asset Restructuring of Listed Companies" and preliminary calculations, this transaction is expected to constitute a major asset restructuring. This transaction does not involve the issuance of shares and will not result in a change of control of the company.

In Ningbo Fangzheng's announcement, the specific amount of this transaction was not disclosed; it only stated that the transaction is expected to constitute a major asset restructuring. This is the second transaction following the company's acquisition of a 40% equity stake in Junpeng Communication last December. During the first acquisition of the 40% equity stake, Junpeng Communication was valued at approximately 863 million yuan.

The business scope of Junpeng Communication includes: manufacturing of computer hardware and software and peripheral equipment, manufacturing of communication equipment, manufacturing of other electronic devices, manufacturing of lighting fixtures, manufacturing of automotive parts and accessories, manufacturing of metal fittings for construction, sales of metal fittings for construction, research and development of hardware products, mold manufacturing, etc.

Public information shows that Ningbo Fangzheng, leveraging its comprehensive competitive advantages and deep customer resources accumulated over many years in the automotive mold industry, has gradually extended into downstream fields from single mold production and manufacturing. It has currently formed core business segments including automotive molds, automotive parts, intelligent equipment, precision structural components for lithium batteries, and conductive connection components for lithium battery modules. Meanwhile, Junpeng Communication's main business is the R&D, design, manufacturing, and sales of structural components for new energy power batteries and energy storage equipment, possessing a solid market foundation and brand influence. It is also reported that after years of development, Junpeng Communication has mastered high-safety and high-precision production processes and established a long-term strategic partnership with the downstream industry leader Contemporary Amperex Technology Co., Limited (CATL), becoming a core supplier of its structural component products.

During the first acquisition of the 40% equity stake, Ningbo Fangzheng stated that the listed company and the target company jointly serve the new energy business sector, with a high degree of business fit, and have strong complementarity and synergistic effects with the company.

The announcement stated that the aforementioned transaction will increase the company's operational scale and performance, helping to enhance its market competitiveness.

In terms of lighting, data shows that Junpeng Communication's business in lighting-related fields mainly focuses on the application of stage lighting products. The company established its lighting division in 2007. Its main products include the Impression series stage wash lights, Spor One and VLS ultra-high-power stage profile lights, WashOne ultra-high-power stage wash lights, and the Pantom series stage displays. It has provided OEM services for internationally renowned companies (such as GLP from Germany).

In addition, public information shows that Junpeng Communication was established on April 29, 2003, and has undergone multiple changes in shareholders since then. On July 3, 2023, Junpeng Communication underwent changes in shareholders and legal representative, changing from six natural person shareholders to Fujian Pengxin Chuangzhan New Energy Technology Co., Ltd., and the legal representative changed from Wang Wei to Fang Ruqi.

Junpeng Communication has a registered capital of 135 million yuan. According to the announcement, the actual transfer price is 945 million yuan, with the subsidy of 64.35 million yuan accounting for 6.8% of the total transaction amount. The daughter of the actual controller of Ningbo Fangzheng bought Junpeng Communication less than two years ago, and now it is being sold to a listed company, sparking speculation.

Major restructuring! Shenghui Technology suspended from trading!

On the evening of April 14, Shenghui Technology announced that it is planning to acquire control of Hepu Energy Environment Technology Co., Ltd. (hereinafter referred to as "Hepu Energy") through share issuance and cash payment. This transaction is expected to constitute a major asset restructuring, but does not constitute a backdoor listing.

According to the relevant regulations of the Shenzhen Stock Exchange, the company's stock will be suspended from trading starting April 15. This transaction will not result in a change of the actual controller of Shenghui Technology.

The announcement shows that this transaction is still in the planning stage. The preliminarily determined counterparties are Hepu Green Energy Storage Technology (Beijing) Co., Ltd., Hepu Blue Sky Energy Saving Technology Service (Beijing) Co., Ltd., Hepu Sunshine New Energy Technology Service (Beijing) Co., Ltd., and Hepu Wisdom (Jingning) Energy Technology Development Co., Ltd.

According to available information, Shenghui Technology was established in 2003 with a registered capital of 497 million yuan. The company's main business includes electrical complete sets of equipment, LED lighting and illumination, smart cities, and hydrogen energy. Its business covers full-scenario solutions from home to city, providing products and services for new energy customers such as those in hydrogen energy. The company's subsidiary, Shenghui Holdings, is a national high-tech enterprise and possesses the Guangdong Provincial LED Lighting Application Engineering Technology Research Center and the Guangdong Provincial Smart Life Engineering Technology Achievement Transformation Center.

It is reported that the company has undergone a strategic transformation since 2020, taking "Intelligence + Dual Carbon" as its strategic direction, adding a hydrogen energy business segment, and establishing the subsidiary Shenghui New Energy Co., Ltd. as the operating entity for the hydrogen energy business to invest in certain links of the hydrogen energy industry chain.

Among them, the company's LED lighting and illumination business mainly includes illumination lighting, home lighting, light sources and electrical appliances, office lighting, commercial lighting, outdoor lighting, and other products. The company not only provides lighting products but, more importantly, delivers solutions for commercial lighting, industrial lighting, road lighting, office lighting, and escape lighting through professional design and implementation, utilizing AI monitoring systems and intelligent dimming systems to achieve high efficiency and energy saving for customers.

The company's core product, the smart street light pole, can integrate functions such as smart road lighting, autonomous driving digital processing terminals, WIFI hotspots, environmental monitoring, emergency visual alarms, smart charging piles for electric vehicles, vehicle monitoring, emergency calls, announcement screens, and broadcasting according to needs, creating convenient, smart, and sustainable facilities and environments for urban construction.

The 2023 annual report shows that the revenue from LED lighting equipment and installation business was 292 million yuan, accounting for 14.59% of the total revenue.

The target company acquired by Shenghui Technology this time is a well-known domestic energy enterprise. It is reported that Hepu Energy, established in 2016, is a national high-tech enterprise serving the fields of new energy power consumption, thermal power flexibility and steam extraction energy storage transformation, and comprehensive energy services. It is one of the earliest enterprises in China to carry out innovative practices in enhancing power system flexibility and has now become a leading enterprise in the field of peak shaving and frequency regulation for thermal power plants nationwide.

Behind Shenghui Technology's active layout in the new energy business is continuously pressured performance. The earnings forecast for 2024 released by Shenghui Technology shows that the net profit attributable to shareholders of the listed company in 2024 is expected to be a loss of 31.6089 million yuan to 63.2178 million yuan, but the loss has narrowed significantly compared to the same period last year.

Shenghui Technology stated that during the reporting period, the company's revenue decreased compared to the same period last year, as its main customers' industries and new energy businesses were still being actively developed.

This acquisition of Hepu Energy may achieve industrial synergy and enhance the company's operating performance.

Recently, Shenghui Technology has shown strong performance in the secondary market, with a gain of 30.47% since April 9. As of the close on April 14, the company's stock price closed at 8.52 yuan/share, with a single-day increase of 9.37%, and a total market capitalization of 4.2 billion yuan.