Hundreds Of Millions Of Yuan Of Related Party Transactions Were Not Disclosed In Time, Leading Chinese Cashmere Ma Haike "Ate" Regulatory Letter

Dehong international cashmere Co., Ltd. (hereinafter referred to as "Dehong international") issued an announcement on July 23 that the company received the decision of Ningxia securities regulatory bureau of China Securities Regulatory Commission (CSRC) on the supervision and management measures of taking warning letters from Dehong international cashmere Co., Ltd. and mahako on July 22, which showed that:

On October 9, 2017, Dehong international cashmere Co., Ltd. (hereinafter referred to as "Dehong international") and detai (Ningxia) cashmere industry Co., Ltd. (hereinafter referred to as "detai cashmere industry") signed a "purchase and sales contract" to purchase 140 million yuan of cashmere from detai cashmere. On November 23, 2017, Dehong international advanced 100 million yuan to detai cashmere. In May 2018, Dehong international and detai cashmere signed the supplementary agreement, which changed the purchase contract amount to RMB 93.5767 million. The above contract amounts respectively accounted for 7.55% and 4.67% of the company's latest audited net assets. As of September 2018, the company has received a refund of 17.595 million yuan from detai.

The actual controller of detai cashmere is Ma Haike, the actual controller of Dehong international, and the current shareholders of detai cashmere are heijinhai and Li Jinying as the nominal shareholders. Only Ma Haike, the actual controller of the company, and two nominal shareholders are aware of the above-mentioned holding. The company did not perform the corresponding review procedures for the above-mentioned related parties and related transactions, nor disclosed them in the interim announcement or periodic report. According to relevant regulations, Dehong international and detai cashmere are related parties under the same control, and the above-mentioned related party transactions of the company shall be disclosed. As the chairman of the board of directors of the company, Mahatma shall bear the main responsibility for the above matters.

According to the relevant regulations, Ningxia regulatory bureau of China Securities Regulatory Commission decided to issue a warning letter to Dehong international and mahico and record it in the integrity file of securities and futures market.

According to public information, Dehong international was established in 2005 as a Sino foreign joint venture. It is located in Jinfeng Industrial Park, Yinchuan economic and Technological Development Zone, Ningxia, China. It covers a total area of 420 mu, with a registered capital of 280 million yuan and a total investment of 700 million yuan. The company mainly deals in the production and sales of various kinds of cashmere, sliver, yarn, fabric, clothing and related processed products and handicrafts, import and export machinery and equipment and agency import and export business (except for the commodities under the national quota management).

In 2009, Dehong international was identified as a key leading enterprise and a key foreign exchange earning enterprise by Ningxia Autonomous Region, and was rated as enterprise credit AAA and import and export demonstration unit by the Ministry of Commerce. Since 2009, it has been successively rated as one of the top 500 competitive enterprises in China's textile and garment enterprises and one of the top ten enterprises in China's cashmere industry. Since 2010, it has been awarded the titles of top 10 textile enterprises in Ningxia, advanced collective of Ningxia light and textile Innovation and development, advanced enterprise of industrial economy (maintaining growth), advanced unit of health, ten most influential enterprises, civilized unit and Yinchuan small giant enterprise.

Ma Haike was born in 1955, Chinese nationality, no permanent right of abode abroad, bachelor degree. From August 1976 to December 1980, he successively served as the teacher and President of Yanglu School District, Tongxin County; from February 1981 to December 1986, he served as a cadre of Tongxin county finance and Taxation Bureau; from January 1987 to February 1991, he served as the factory director of Tianjin Haihe fluff factory; from February 1991 to July 1993, he served as the manager of Bohai native animal products company; from August 1993 to January 1995, he served as the general manager of Haide local animal products company; from February 1995 to February 1998, Dehai (Tianjin) was appointed He has been the chairman of the board of directors of Ningxia Dehong International Co., Ltd. from January 1998 to September 2014, and served as the chairman of Dehong International Co., Ltd. from January 2014 to September 2014.

According to the data, Ma Haike is also the vice president of Ningxia minmao Halal Products Enterprise Association and other social organizations. He has also won the honors of world outstanding Chinese businessmen, top ten leaders of Chinese cashmere industry, outstanding Hui businessmen of Ningxia, honest entrepreneurs of Ningxia, and top-notch talents of Yinchuan city.

On June 3, 2019, Dehong international disclosed that Mr. Ma Haike, the actual controller, legal representative and chairman of the company, had been included in the list of persons subjected to dishonest execution due to his involvement in a case. The specific behavior of the person subjected to execution in breach of trust shows that other parties evade execution.

However, due to Dehong International's failure to disclose the 2018 annual report on time, the company's shares have been suspended from May 6, 2019. According to the latest financial report, as of June 30, 2018, in the first half of 2018, Dehong international achieved a business income of 419 million yuan, and the net profit attributable to shareholders of listed companies was 44.69 million yuan.