AutoBeta(AutoBeta.net)11/29 Report--

On the evening of November 28th, FAW car announced that in order to further optimize the size of the company's share capital after the transaction and comprehensively consider the company's ability to pay cash, it plans to cancel 3.5 billion yuan of matching fund-raising. FAW Jiefang 100% equity held by FAW shares was purchased through major asset replacement, share issue and cash payment.

The company said that after this restructuring, its main business has been changed to FAW with strong profitability, and its profitability and core competitiveness have been improved.

According to the research report, FAW Jiefang is one of the best assets of FAW Group and the absolute leader of the domestic heavy truck industry, ranking first in the industry for a long time. According to the data, the net profits of FAW shareholders belonging to listed companies in 2017 and 2018 were 2.24 billion yuan and 1.45 billion yuan, compared with 1.66 billion yuan in the first half of this year.

By contrast, the development of FAW cars is not very good, with revenue of 17.292 billion yuan in the first three quarters of this year, down 6.95% from the same period last year, and net profit loss of 267 million yuan, down 297.33% from the same period last year.

In fact, in order to solve the problem of competition between the two sides, FAW Group began to solve it as early as 2011. In June 2011, FAW Group set up FAW shares to carry out the reorganization and restructuring of the main business, and made an irrevocable commitment to FAW cars and FAW Xiali, planning to integrate its car production business through asset restructuring or other means within five years.

FAW Group's search for an overall listing has been delayed for eight years, and it was not until April this year that FAW Group made substantial progress. On April 11, FAW cars whose trading was suspended for 11 trading days due to major asset restructuring resumed trading, and announced its plan for major asset restructuring. FAW Group took a big step forward in seeking the overall listing.

On August 30, FAW cars disclosed the draft restructuring, using 100% equity in FAW cars as purchased assets and replacing it with the equivalent portion of FAW Jiefang 100% stake held by FAW.

According to the draft disclosed at that time, FAW car intends to buy 100% stake in FAW Jiefang. After the completion of the transaction, FAW's shareholding in FAW cars has further increased from 53.03% to 83.41%, and the main business of FAW cars will also be changed to commercial vehicle R & D, production and sales. On September 27, FAW issued an announcement, and SASAC of the State Council approved the asset reorganization, agreeing in principle.

Some people in the industry said that FAW Group's capital operation has been frequent in the past two years, and the injection of FAW liberation can be seen as a signal for FAW Group to start listing as a whole again. According to the data, FAW Group has four listed companies, namely, FAW Xiali, FAW cars, FAW Fuwei and Qiming Information. FAW Group is the only automobile company among the six major automobile groups that has not been listed as a whole.

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