Lifan's restructuring is coming to an end: Geely helps Lifan, and the battery swap business begins
This means that Lifan’s reorganization plan has made substantial progress. It is reported that Lifan Co., Ltd. will convene the second meeting of creditors and shareholders on November 25 to review and vote on the "Reorganization Plan (Draft)". Once the vote is passed and the court ruling is obtained, Lifan Co., Ltd. will officially complete the reorganization.
Geely helps, Azolla Fund "saves" Lifan
Geely, which has been rumored for a long time, has become the biggest support for Lifan's restructuring.
Since the reorganization of Lifan shares was launched in August this year, rumors about Geely’s acquisition of Lifan have been endless. However, Geely Auto has repeatedly denied rumors that Geely intends to acquire and reorganize Lifan Motors, saying it was unaware of it.
In August this year, the No. 5 Intermediate People’s Court of Chongqing accepted the reorganization case of Lifan Shares and designated the liquidation team of Lifan Group as the manager of Lifan Shares to be responsible for carrying out various reorganization tasks. During the reorganization process, the manager identified Geely Maijie Investment Co., Ltd. (Geely Maijie) and Chongqing Liangjiang Equity Investment Fund Management Co., Ltd. (Liangjiang Fund) as consortiums as intended reorganization investors through open recruitment. Geely has finally unveiled its plans to restructure Lifan shares.
On November 6, the manager signed an agreement with Liangjiang Fund, Geely Maijie and Geely Technology Group, the parent company of Jilin Maijie, to clarify the identity of the reorganization investor and determine the role of Geely Maijie. , the "Manjianghong Equity Investment Fund Company (Limited Partnership)" jointly established by Liangjiang Fund ***, as well as Geely Maijie, Geely Technology or companies with absolute control of more than 70% of the shares held by the two as participating companies in the restructuring investment the implementation entity.
In the "Reorganization Plan (Draft)" released this time, the reorganization plan will be implemented based on Lifan's 1.285826279 billion circulating shares, with an increase of 24.99695156 shares for every 10 shares. Capital reserves were transferred to share capital, with a total of 3.214173721 billion shares transferred. The overall share capital increased to 4.5 billion shares, with Azolla Fund accounting for 29.99% and Geely Group indirectly accounting for 14.7%.
In addition, the converted shares will not be distributed to shareholders, and will all be distributed and disposed of by the manager in accordance with the provisions of the reorganization plan. After the reorganization of Lifan shares is completed, the controlling shareholder of the listed company will be changed from Lifan Holdings to Azolla Fund. According to the announcement, Azolla Fund will conditionally transfer 1.34955 billion shares of the transferred shares, and at the same time pay a transfer price of 3 billion yuan to Lifan Co., Ltd.; 900 million shares will be used to introduce industrial investors; and about 9.6 billion shares will be used to introduce industrial investors. 100 million shares were used to pay off debts, of which approximately 560 million shares were allocated to ten subsidiaries.
Although the final official announcement has not yet been made, with the "assistance" of Geely, Azolla Fund has given Lifan shares the hope that the reorganization will be successful.
It is not easy to take over, Lifan has several major problems
As a well-known private car company in Chongqing, Lifan has now withdrawn from the mainstream of the automobile industry. Lifan Motors is swaying under the pressure of declining sales, debt, tight capital chain, and dealer rights protection.
In the past year, money has become a "big problem" for Lifan shares. As of March 15, 2020, *** 530.3 million yuan of bonds were overdue because they could not be redeemed on time. Starting from March 16, 2020, the "16 Lifan 02" corporate bonds were suspended from the fixed income securities comprehensive electronic platform; in April, Lifan Co., Ltd. announced that due to a sales contract dispute between the company's subsidiary Chongqing Lifan Passenger Cars and Chongqing Panda Car Rental Company, Panda Automobile filed an arbitration application with the Chongqing Arbitration Commission, requesting Lifan Passenger Cars to compensate 798 million yuan.
In August this year, Lifan Co., Ltd. issued an announcement showing that the company (including subsidiaries) had undisclosed litigation (arbitration) amounts totaling approximately 298 million yuan in the past 12 months; there were 1,178 litigations (arbitrations) involved. , the cumulative amount is 5.037 billion yuan.
Reporters from the Beijing News have repeatedly reported on Lifan’s liabilities and capital chain difficulties. On September 10 last year, 108 million shares held by Lifan Holdings, the controlling shareholder of Lifan Co., Ltd., were waiting to be frozen. Lifan Holdings stated that Lifan Holdings *** holds 618 million shares of the company, accounting for 47.08% of the company's total share capital. After the shares were waiting to be frozen, the cumulative number of shares held by Lifan Holdings that were judicially frozen and waiting to be frozen was 616 million, accounting for 99.55% of its total shareholdings and 46.87% of the company's total share capital.
In addition to the financial disputes that "continue to be sorted out and become chaotic", the main automobile business is almost difficult to maintain and is facing huge losses. There are frequent rumors of bankruptcy.
The third quarter report disclosed on the evening of October 29th showed even more serious losses.