Jihua Group issued a number of announcements on the evening of December 1, including that the company planned to transfer 100% of the equity of its five wholly-owned subsidiaries to its controlling shareholder Xinxing Jihua Group Co., Ltd. (hereinafter referred to as “Xinxing Jihua”); changes Part of the investment projects; accelerate the divestiture of non-advantageous industries, further optimize the company’s assets and business structure, focus on the main responsibilities and main businesses, and build core competitiveness.
The announcement shows that Jihua Group plans to transfer its 100% stake in Guangdong Jihuayuan Investment Development Co., Ltd. , 100% equity of Wuhan Jihuayuan Investment and Construction Co., Ltd., 100% equity of Jihua Group Jiangsu Industrial Investment Co., Ltd., 100% equity of Qinhuangdao Jihua 3544 Shoes Co., Ltd., 100% equity of Jihua 5303 Clothing Co., Ltd. % equity was transferred to Xinxing Jihua for a total price of 408 million yuan.
According to our understanding, Jihua Group is a core supplier of military procurement. Professional clothing, professional shoes and boots, leather shoes, textile printing and dyeing, and protective equipment are the company’s current core businesses.
Jihua Group stated that the company will further introduce professional operating institutions according to changes in market demand, adjust and optimize the business layout, steadily improve operating levels, and increase operating income. At the same time, we actively look for project investors to further improve project management and control capabilities, control investment scale, and reduce investment risks.
Among the above-mentioned transfer projects, the Jihua Park Qingyuan Project, Jihua Park Xianning Project, and Jihua Park Yangzhong Project are the projects that Jihua Group invested in through non-public issuance of shares in 2017. . If this transfer is completed, 871 million yuan of the remaining unused funds raised from the above three projects will be invested in the “Main Business Equipment Intelligent Upgrading and Transformation Project” and the “Special Protection and Emergency Support Base Construction Project.”
The “Main Business Equipment Intelligent Upgrading Project” covers three sub-divisions: Jihua clothing intelligent production line transformation, Jihua footwear intelligent production line transformation, and Jihua Group information system construction. The project, “Special Protection and Emergency Support Base Construction Project” covers two sub-projects: Jihua Emergency Support Base Construction and Jihua Special Protection Equipment Production and Research and Development Base.
Jihua Group stated that through the implementation of the above projects, it will enhance the company’s control over the protective equipment industry chain and its voice in the distribution workwear market, and enhance its one-stop overall solution supply capacity. The State Council recently issued the “Opinions on Further Improving the Quality of Listed Companies”. This move by Jihua Group is also a reflection of the comprehensive implementation of further improving the asset quality of listed companies and improving the level of standardized operations. </p
