AutoBeta(AutoBeta.net)08/15 Report--

China first Automobile Co., Ltd. will list and transfer a total of 73.70 percent of its subsidiary, Machinery Industry Ninth Design and Research Institute Co., Ltd., with a base price of 695.1807 million yuan and the expiration date of information disclosure, according to domestic media reports.

Machinery Industry Ninth Design and Research Institute Co., Ltd. was established in 1987, FAW 100% holding company, the main business scope is engineering design, is a well-known planning and design company in the domestic automobile industry. He has participated in the planning, design, reconstruction and expansion of China's first Automobile Factory, second Automobile Factory, Beijing Automobile Factory, Nanjing Automobile Factory and Jinan Automobile Factory.

According to the listing information, the operating income of the Ninth Design Institute in 2018 is about 1.153 billion yuan, and the net profit is 77.9543 million yuan; as of May 31 this year, the operating income of the Ninth Design Institute is about 254 million yuan, and the net profit is 37.7731 million yuan. That is to say, from the financial data, FAW shares did not sell the equity of the Ninth Design Institute for performance reasons.

From the point of view of the transfer conditions, the requirements put forward by FAW shares are also relatively strict. Among them, the reserve price for the transfer of 73.70% equity of the Ninth Design Institute is 695 million yuan. In addition, the transferee must fully approve and accept the resettlement plan for the relevant staff of the Ninth Design Institute.

Previously, FAW Group had envisioned using FAW shares as its overall listing platform, so divesting the non-high-quality assets of the Ninth Design Institute is good for its overall listing plan. Previously, "FAW cars intend to purchase the shares of FAW Jiefang Automobile Co., Ltd. held by FAW shares and raise supporting funds by means of asset exchange and issuing shares to purchase assets" was also considered to be the overall listing layout of FAW Group. however, there is no practical trend from the practical level. There is also a view that FAW Group is currently in the mixed reform stage, and the sale of the stake in the Ninth Design Institute may only be a normal mixed reform work.

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