After "snake swallowing elephant", the volume of Fu Ren pharmaceutical will be increased nearly 7 times

[China Pharmaceutical network enterprise news] over the years, the rumors of the overall listing of pharmaceutical assets under Furen group have attracted the attention of the capital market Finally, this market rumor of many years was put into action last year However, just a moment after the meeting of M & a group, Furen pharmaceutical took the initiative to suspend the reorganization, leaving a huge space for market discussion Now, it remains to be seen whether Furen pharmaceutical industry is making a comeback, whether it is to continue the game of "wolf comes" or whether its long cherished wish has come true for many years However, if the "snake swallows the elephant" comes true, its asset scale and profitability will be multiplied, and it will also give a huge space for its future development It was nearly a year after Furen pharmaceutical made a comeback and acquired kaiyao group again The acquisition of kaiyao group by Furen pharmaceutical was restarted On the evening of August 31, Furen pharmaceutical released the report on issuing shares and paying cash to purchase assets and raise supporting funds and related transactions, announcing the resumption of the merger and acquisition of Kaifeng Pharmaceutical (Group) Co., Ltd (hereinafter referred to as Kaifeng group)   According to the announcement, Furen pharmaceutical intends to issue shares and pay cash to 14 counterparties, including the controlling shareholder Furen group, pingjiaxinyuan, jinchengyuyao, wanjiaxinwang, Dingliang kaiyao, Keruite, Everest cornerstone, leader cornerstone, Jincheng Zhixin, Dongtu Datang, Dongtu Taiyao, PEZ investment, ocean cornerstone, and China Europe cornerstone, to purchase the total shares held by the group 0% equity interest According to the reporter, the transaction plan issued by Furen pharmaceutical includes issuing shares, paying cash to purchase assets and raising supporting funds Among them, Furen Pharmaceutical Co., Ltd plans to purchase 100% of its shares in kaiyao group from 14 counterparties such as Furen group, with the target assets valued at RMB 7.809 billion At the same time, no more than 10 qualified specific objects will be issued non-public shares to raise supporting funds, with the total amount of raised funds not exceeding 5.3 billion yuan and not exceeding 100% of the transaction price of the underlying assets However, the estimated value of the assets of the group is 7.809 billion yuan After deducting the cash consideration, the company will issue 449564648 shares based on the issue price of 16.50 yuan per share The supporting funds raised this time are 5.3 billion yuan, and the company will issue no more than 321212121 shares according to the calculation of the issuance base price of 16.50 yuan / share Before this transaction, the total number of shares of Furen Pharmaceutical Co., Ltd was 177592900 According to the calculation, the total number of shares of the listed company after the completion of the asset purchase of this issuance is 627.1575 million shares, and the total number of shares of the listed company after the completion of the supporting fund raising is 948.3696 million shares According to the announcement, after the completion of this transaction, Furen pharmaceutical will hold 100% of the shares of the group However, the total proportion of shares held by Furen group and its related party CREIT is 31.74% This also means that this transaction did not result in the change of the actual controller The controlling shareholder of the company is still Furen group and the actual controller is still Zhu Wenchen, its chairman According to the public information, kaiyao group is a large modern pharmaceutical group integrating research and development, production and sales of chemical drugs, Chinese patent medicines and APIs Through years of research accumulation and business development, the group has developed into a pharmaceutical enterprise with a large number of varieties and comprehensive dosage forms, which has strong comprehensive strength and market competitiveness in the pharmaceutical industry As of the signing date of this report, kaiyao group has 9 wholly-owned subsidiaries, namely homologous pharmaceutical, huaiqingtang, Kaifeng Yugang, Furen pharmaceutical, Dongrun chemical, Zhengzhou Yugang, Zhengzhou Yuance, Kailu pharmaceutical and Beijing Ruihui In the view of analysts, after the successful completion of the acquisition, not only will the volume of Furen pharmaceutical industry achieve a substantial growth, but also the core pharmaceutical assets of Furen group will be listed as a whole After "snake swallowing the elephant", the volume of Furen pharmaceutical will be enlarged nearly 7 times Furen pharmaceutical acquires kaiyao group, which has long been regarded as a "snake swallowing the elephant" like transaction by the market The reason is simple They don't seem to be in the same order of magnitude at all According to the audited consolidated financial statements of kaiyao group, as of December 31, 2016, the total assets of kaiyao group were 7 billion 515 million 218 thousand and 200 yuan, and the owner's equity attributable to the shareholders of the parent company was 3 billion 851 million 736 thousand and 900 yuan; the operating income of 2016 was 4 billion 533 million 759 thousand and 500 yuan, and the net profit attributable to the shareholders of the parent company was 652 million 845 thousand and 800 yuan By the end of 2016, the total assets of Furen Pharmaceutical Co., Ltd were 1.273 billion yuan, and the owner's equity attributable to the shareholders of the parent company was 369 million yuan In the whole year of 2016, Furen pharmaceutical achieved a revenue of 496 million yuan, with a net profit attributable to the parent of 17.6567 million yuan If we combine the statements of kaiyao group with them, it will be a completely different scene According to the report, by the end of 2016, the total assets of Furen pharmaceutical will be 8.78 billion yuan, the owner's equity attributable to the shareholders of the parent company will be 3.83 billion yuan, and the annual revenue will be 5.01 billion yuan, and the net profit attributable to the parent company will be 670 million yuan Take the results of the first quarter of this year for comparison, the same is true Take the total assets as an example In the first quarter of 2017, the total assets of Furen Pharmaceutical Co., Ltd were 1.29 billion yuan, and 8.9 billion yuan after the transaction (for future reference); from the perspective of earning capacity, the annual net profit attributable to the shareholders of the parent company in the first quarter of this year was 5.5785 million yuan, and that after the transaction (for future reference) was 157 million yuan This also means that if the acquisition of prescription drugs is completed, the asset scale of Furen pharmaceutical will be 7 times of the current one, and the profitability will increase nearly 27 times or 38 times compared with the current one Not only that, according to this year's Zhongbao of Furen pharmaceutical, the company's operating revenue is 263 million yuan, up 19.19% year on year; the net profit attributable to the parent company is 10122600 yuan, down 28.8756% year on year; and the earnings per share is 0.06 yuan It is not difficult to see that in recent two years, although the revenue of Furen pharmaceutical industry has been growing steadily, its profitability has been declining In fact, for the business situation in the past two years, Furen pharmaceutical said that due to the small scale, single product and other factors, the development speed of the company's traditional Chinese medicine business has fallen into a bottleneck in recent years, and it is difficult to further improve the sales scale and business performance in the short term At present, the asset scale and profitability of the group have obviously surpassed that of the pharmaceutical industry of Furen, and become the core enterprise of the group and the main pharmaceutical operation assets of the group Injection of kaiyao group into listed companies can basically realize the overall listing of pharmaceutical assets of Furen group It's not hard to understand why it's a long cherished wish of Furen group for many years to inject kaiyao group into listed companies Fu Ren pharmaceutical said that after the transaction, the company's main business will increase the R & D, production and sales of chemical drugs and APIs on the existing basis Through this transaction, it can make up for the company's blank in the field of chemical medicine and API, expand the scale in the field of Chinese patent medicine, effectively enrich the product structure, realize diversified development, and avoid the single operation risk of existing products In addition, through the integration of pharmaceutical resources with the pharmaceutical development group and giving full play to the synergistic effect, Furen pharmaceutical industry will significantly enhance its comprehensive competitiveness, improve its position in the industry and enhance its sustainable profitability (next to A02) (last to A01) M & A and drug prescribing, last year "stopped" at a later moment In fact, as early as 2014, the rumour that drug prescribing group will inject into Furen pharmaceutical industry was spread at the market level Although at the shareholders' meeting on March 20 of that year, Zhu Wenchen made it clear that Furen group "is always looking for the possibility of overall listing" and stressed that it will be listed "at the right time", with a timetable of 3 to 5 years But at that time, a series of market operations of Furen group were regarded as drug development group to inject listed companies to clear the obstacles At the end of 2015, Furen pharmaceutical finally put forward a restructuring plan, and planned to purchase 100% of the shares of the pharmaceutical development group held by 14 counterparties such as Furen group, a major shareholder, through non-public issuance and payment of cash totaling RMB 7.85 billion, while supporting fund raising shall not exceed RMB 5.3 billion On May 17, 2016, Furen pharmaceutical submitted relevant application documents to CSRC After two inquiries from the regulatory authorities and two replies from Furen pharmaceutical, the M & A and reorganization Review Committee of listed companies of CSRC arranged to hold the 72nd working meeting of the M & A and reorganization committee in 2016 on September 28 of that year, which will review the issue of shares and purchase of assets of three companies including Furen pharmaceutical However, no one thought that just a moment before the meeting, that is, in the evening of September 27 last year, Fu Ren pharmaceutical suddenly announced that it had decided to apply to the CSRC to suspend the issuance of shares and the payment of cash to purchase assets and complete the examination of fund-raising matters As for the reasons, Furen pharmaceutical has given such an explanation, "as the company is involved in the verification of major events, it is temporarily unable to estimate the time required for verification, so it is decided to apply to the CSRC for suspending the verification of major asset restructuring events." What is the specific verification? Furen pharmaceutical didn't make it clear, but another announcement on the same day mentioned that the company received the decision on Issuing warning letter measures for Furen pharmaceutical issued by Henan securities regulatory bureau, which is related to the failure of timely letter delivery of subsidiary transfer of Furen pharmaceutical Although the audit was suspended, all kinds of news flew around for a while, especially the news with explosive words such as "private fund pressure, gambling agreement, financial fraud, buyback", which attracted countless eyeballs Because of this, the regulatory authorities have repeatedly inquired about the above-mentioned rumors, while the pharmaceutical industry of Furen has constantly issued announcements, clarifying the market rumors on the one hand, and explaining the inquiries of the regulatory authorities on the other Now, Furen pharmaceutical industry is making a comeback for M & A of kaiyao group Obviously, it has dealt with all the troubles before M & A returns to normal According to the relevant announcement, through this transaction, Furen pharmaceutical intends to acquire kaiyao group and its biomedical R & D company through kaiyao group, so as to build Furen pharmaceutical industry into a large-scale comprehensive pharmaceutical listed company platform covering chemical medicine, Chinese patent medicine, API and Biopharmaceutics, and basically realize the integration of core pharmaceutical assets of Furen group Physical listing In response, Furen pharmaceutical said that after the completion of this transaction, the company will realize the intensive operation of unified planning, unified management and unified operation in the pharmaceutical field, and the scale advantage will be further revealed As the volume increases, the profitability is greatly improved, and the scale effect is obvious, it can be said that the merger and acquisition of kaiyao group by Furen Pharmaceutical Co., Ltd has a pretty good space However, after the last "wolf came", whether the restructuring can fulfill the long cherished wish of Furen group deserves market attention At present, for M & A and restructuring, the regulatory authorities have made intensive voice in recent period At the recent mid year regulatory work symposium, the CSRC's attitude towards M & A and restructuring conveyed a very clear and clear signal: regulate and support M & A and restructuring of listed companies In this regard, some analysts told reporters that the merger and reorganization of A-share market has gradually returned to normal from the audit frequency observation after the regulatory authorities strengthened the regulation This view is also supported by data Data shows that as of August 24, there are 109 companies in this year