Qingdao Double Star'S Shoe Pain

In November 17th, Qingdao double star 000599 announced that the company intends to issue private placements, and plans to raise about 400 million yuan for 1 million 300 thousand sets of high performance all steel radial tire technology pformation projects and repayment of bank loans.

This is the major takeover in September 3rd, and Qingdao's double star is once again strengthening the tire industry.

Qingdao double star, which focused on tires and shoemaking, began to enter the tire industry in 2001 by merging the local tire production giant Qingdao Huaqing tire Industrial Corporation.

In 2003, the Qingdao double star board stressed that the development strategy of enterprises is to invest more in the tire industry, so that the main business of the company can be extended from single cold sticky footwear manufacturing and sales to the manufacture and sale of rubber tires and other products.

In order to make the tire industry bigger, the company has established a double star wind tire company, which is ranked first in the production of farm vehicles in Shandong, Gaotang County, to produce agricultural tires, light truck tyres and radial tires. Then managed Dongfeng Tire assets and set up Twin Star Dongfeng Tire Co., Ltd., and invested in Henan Ru'nan tire project.

In recent years, the income of Qingdao Twin Star tire business has increased from 300 million yuan in 2000 to 700 million yuan in 2001 to 2 billion 500 million yuan in 2006.

At present, the income and profits of Qingdao's twin stars are mainly from the tire industry.

In the first half of this year, the company's operating income exceeded 2 billion yuan, and the operating income of tires exceeded 1 billion 700 million yuan, an increase of 43.33% over the same period last year.

The sales revenue of footwear products reached 164 million yuan, down 1.15% compared with the same period last year.

The company expects that in the next 15 years, China's heavy truck tire market will still be in short supply.

With the increasing demand for all steel radial truck tires in the domestic market, expanding the production scale and improving the scale efficiency of all steel radial tires will help to enhance the overall strength and market competitiveness of the Twin Star tires.

For this reason, Qingdao Binxing intends to carry out technological pformation based on the scale of the original annual production of 2 million 600 thousand sets of all steel radial truck tires. After completion of the expansion, the production capacity of 3 million 900 thousand sets of all steel radial truck tires will be formed.

Disputed "take off shoes" in order to focus on the big tire industry, Qingdao Binxing gave up its old business -- shoe industry.

This process is full of disputes.

In April 24, 2006, the board of directors of the Qingdao double star decided to pfer the footwear assets to the associated star company of the two stars (hereinafter referred to as "celebrity industry").

A month later, in May 27th, the Qingdao shareholders' meeting adopted the resolution.

Qingdao double star sells cold sticky shoes business, including housing construction, machinery and equipment, construction projects and land use rights and other assets. The adjusted net book value is 88 million 838 thousand and 500 yuan.

After consultation, the pfer price will be set as the net value of the assessment - 110 million 159 thousand and 800 yuan.

On that day, the two companies signed the paction contract.

The reason for "taking off shoes" is that the competition in the shoemaking industry is fierce and the profit rate is falling. Avoiding potential competition and reducing related pactions will help to concentrate on strengthening and strengthening tire business.

The core business of Qingdao's twin star has become a single tire manufacture and sale. The pair of star shoes will be stripped off the listed companies.

Originally, the two star group has two assets on the footwear industry: one is the cold sticky shoes business of listed companies, and the two is the vulcanized footwear business of celebrities.

Tires and shoemaking are among the first and second largest industries in Qingdao's double star industries. The main business income in the first half of 2007 was 1 billion 723 million yuan and 164 million yuan respectively, with gross margins of 8.49% and 15.15% respectively.

This shows that although the footwear industry is in a highly competitive market, gross profit margins are still higher than the tire business.

There is considerable opposition to the related pactions.

First, there is suspicion of serious privatization.

Statistics show that celebrity industry was established in September 16, 2002, with a registered capital of 31 million 530 thousand yuan, and the legal representative is tin Sheng, whose other status is vice president of Binxing group.

What is striking is that celebrity industries are dominated by natural persons. Wang Hai is the largest shareholder, accounting for 21.88% of shares and chairman of the board. 5 senior executives of Qingdao double star, including Wang Hai, share 46.78% of celebrity industry and 10 of the other 10 natural persons.

In addition, the Binxing group holds 16.5% of the surplus, while the state-owned enterprise Binxing group only holds 16.5%.

Two, acquisition capacity.

Celebrity industry is mainly engaged in vulcanized footwear business. As of December 31, 2005, the total assets of celebrities were 152 million yuan, the total liabilities were 121 million yuan, the net assets were 31 million yuan, and the liabilities rate was over 79%.

In recent years, the management of celebrities industry has gone from bad to worse, and in 2005 it was in a state of slight deficit.

Today, we need to pay 110 million 159 thousand and 800 yuan in cash, and the strength of celebrities is not enough.

Three, the procedure is careless.

According to the relevant regulations, the pfer of state-owned assets should be carried out by public bidding. Qingdao binaries do not have public bidding, and their land assets appraisal process is also not pparent.

Disputes between officials and businessmen?

Chairman Wang Hai's privatization plan can be traced back to 2000.

At that time, Wang Hai led the two star group to restructure and sell the sales network. The specific way was to pform the chain's operation system from "state owned enterprise" to "private owned private enterprise", that is, selling it to individuals.

In September 2003, the double star group has completed the restructuring of more than 3000 stores in the whole country. Not only that, media reports have reported that all the subsidiaries of Qingdao's twin stars, and the more than 140 three production companies of the group's property, tourism and entertainment, have all been restructured, all of which are owned by employees.

However, due to the overall reform of Target Corp, the pfer of shoes industry assets has not been implemented for a long time.

In this regard, Wang Hai has publicly stated that the reason why Qingdao's double star footwear assets have not yet been pferred successfully is mainly due to the objection of the Qingdao SASAC, "they think I am in the process of turning state-owned assets, so I do not agree".

At that time, Qingdao SASAC made a thorough investigation of the state-owned property rights pactions of the two star group over the years.

Qingdao requires that the related pactions of footwear assets will be carried out simultaneously with the restructuring of the Binxing group.

According to reports, in the scheduled Double Star Group restructuring plan, the two star group will sell 16.5% of the famous industrial shares.

Subsequently, the double star group will be cancelled, and the management level of Qingdao SASAC will be reduced to one level, reaching the listed companies directly, which will facilitate the supervision of state assets and facilitate the introduction of strategic investors later.

After double star group withdraws from celebrities, celebrities will become a company controlled by Wang Hai and Qingdao double star executives. There will be no property relations between Qingdao listed companies and celebrities.

It is said that after the privatization of the double star shoe industry, Wang Hai will leave Qingdao Binxing in retirement and focus on the development of celebrity industry.

In addition, the related pactions between Qingdao's twin stars and celebrities will continue.

This may be a paction acceptable to both owners and managers.

According to the October 9th announcement, the net value of Qingdao double star shoe-making business assets assessment was released by the company in April 27, 2006 on the "asset sale and related pactions notice" 110 million 159 thousand and 800 yuan, increased to 132 million 873 thousand and 400 yuan, the main reason for the increase is the value of land in the sale of assets.

At present, the pfer of the footwear business assets has been completed in the Qingdao municipal government's SASAC's asset appraisal project.

However, according to the announcement of the Qingdao property exchange online, some investors believe that the classification and status of footwear assets are not clear, and the conditions imposed by the pferee are too harsh.

They suggested that after the resignation of the chairman of the Qingdao Binxing company, the assets should be auctioned and reorganized, not only for fairness, but also for the chairman.