Ziguang Group'S Reorganization: Ambition, Luck And Destiny Behind 200 Billion Debt

As for Zhao Weiguo, one of the most frequently cited bridge segments is that six years ago, he went to Taiwan for an inspection tour, publicly criticized Taiwan semiconductor for not opening up to the mainland as a "dead end", and made bold words to buy power from power.

This vague story, at present, is most catering to the market, and is willing to be labeled with Zhao Weiguo's "M & a maniac".

On July 9, Ziguang group became the public focus because of a notice issued by Beijing first intermediate people's court.

The creditors applied to the court for bankruptcy reorganization on the grounds that Ziguang group could not pay off its due debts, its assets were not enough to pay off all the debts, and it was obviously lack of solvency, and had the value and feasibility of restructuring.

This 30-year-old large-scale enterprise started from Tsinghua University seems to echo the bankruptcy reorganization of founder of Peking University.

In 2018, on the eve of the exposure to the debt crisis, Zhao Weiguo mentioned "managing your ambition and luck carefully".

These two words are more fatalistic when viewed from time to time.

In the A-share market, the footprint of purple light once spread over more than 30 companies.

In the debt restructuring of Ziguang group, the core of these companies is the conjecture about the direction of China's chip industry.

The 21st century economic report reporter once called Ziguang shares to inquire about the relevant situation. A staff member of the company's Securities Department said, "I don't know about this matter" and "it's better to ask Ziguang group about equity acquisition". Talking about the impact of Ziguang Group bankruptcy reorganization on the company, the person said, "the company's production and operation activities are normal." The reporter has also contacted Ziguang group for many times, but no one has answered the public calls.

Zhao Weiguo has repeatedly stressed that capital merger and acquisition is only regarded as a means, "science and technology industry is fundamental".

Ziguang Group bankruptcy reorganization drama prologue, the story was finally ended by capital means.

Ziguang Group bankruptcy reorganization drama prologue, the story was finally ended by capital means. Visual China

"M & a maniac" Zhao Weiguo

Zhao Weiguo is a man of great personality and controversy.

According to hexun.com, Zhao Weiguo went to Taiwan for an inspection tour in 2015. He publicly criticized Taiwan semiconductor for not opening up to the mainland as a "dead end". He made a bold speech to buy the power from the power station. His high-profile move, which is almost maddening, is eye-catching.

As for the purple light group such a 300 billion capital empire, once on the verge of collapse, the outside world almost unanimously believed that the cause of purple light's radical capital operation.

According to incomplete statistics, in the short six years from 2013 to 2019, Ziguang Group invested a lot of money to acquire more than 20 companies, most of them chip companies of different types. And there is a key figure behind this - the promotion of Zhao Weiguo, chairman of Ziguang group.

Zhao Weiguo graduated from Tsinghua University, and his early wealth accumulation mainly came from the real estate industry in Xinjiang. In 2009, Zhao Weiguo seized the opportunity of Tsinghua University to carry out the pilot project of mixed ownership, and entered the purple light group of Tsinghua University through his own Jiankun group.

In 2013, under the leadership of Zhao Weiguo, Ziguang group spent $1.78 billion on acquisition of Spreadtrum communications and entered the chip industry. The Export Import Bank of China and the China Development Bank provided about $900 million in loans. In 2014, Ziguang Group invested $907 million to acquire redico microelectronics to expand the Internet of things chip market. The acquisition was finally realized by overseas financing.

In May 2015, Ziguang invested another US $2.5 billion to take over 51% of the equity of HP's Xinhua 3, which is HP's China business, with headquarters in Beijing and Hangzhou.

Through these three acquisitions, which cost more than 5 billion US dollars, Ziguang group quickly completed the layout of integrated circuit industry.

During this period, the state has also increased its support for semiconductors. In September 2014, the 100 billion level national integrated circuit industry investment fund (large fund) was established. Zhao Weiguo ushered in a favorable time and place.

This also makes Zhao Weiguo in the capital market has the confidence to spend thousands of dollars.

In 2015, Ziguang group launched a bigger acquisition plan to acquire Meguiar technology, the largest memory enterprise in the United States, for us $23 billion. But due to strict scrutiny in the United States, the final deal was rejected. Ziguang even turned its attention to TSMC, the world's largest wafer maker, but the deal was not reached.

Zhao Weiguo is not shy about capital operation. In an interview with the media, he said: "merger and acquisition is a normal phenomenon in the development of Ziguang group to a certain historical stage. It's nothing special. We are new comers, so it's a bit eye-catching. We will get used to it gradually."

Zhao Weiguo did not stop moving forward.

In 2016, Ziguang group cooperated with other parties to establish Yangtze River storage, with 51.04% of shares held by Ziguang group. In 2018, purple light group acquired linxens, a French smart chip module manufacturer, for about 2.2 billion euros.

After a series of successful or unsuccessful mergers and acquisitions, Zhao Weiguo has been named "M & a maniac" by the media.

We have to admit, Zhao Weiguo led the Ziguang group a number of mergers and acquisitions are quite amazing market. For example, Ziguang zhanrui is able to occupy a place in the field of mobile phone chips because of the merger of Spreadtrum communication and radico.

But it is worth noting that after a series of mergers and acquisitions, the assets and liabilities of Ziguang group are also rising rapidly.

In 2012, the total assets of Ziguang group were only 6.663 billion yuan, and the total liabilities were only 4.647 billion yuan. In seven years, while the total assets doubled, the total liabilities also increased by 44 times to 200 billion yuan.

From 2018, Zhao Weiguo began to step down from his important position in Ziguang group. On April 8, 2018, Ziguang shares and Ziguang Guowei announced one after another that Zhao Weiguo resigned from the position of director and chairman of the two listed companies because of his busy work.

After resigning his post, Zhao Weiguo seems to have reflected on his radical M & a style. He said in public, "many of our enterprises have problems in recent years because of excessive expansion of ambition, believing that they can do anything, and believing that luck will happen again. In fact, your abilities and boundaries are not so far away, and your luck is not so good, so you should carefully manage your own ambition and luck. "

In this process, Zhao Weiguo also stepped on many regulatory red lines. In November 2018, Anhui Securities Regulatory Bureau imposed administrative penalties on Ziguang group, Ziguang communications and Zhao Weiguo for illegally increasing their holdings of "Wenyi technology" stocks. In June 2020, Zhao Weiguo, chairman of Ziguang group in time, was punished by Shandong Securities Regulatory Bureau because Shandong Jintai did not make a report.

Debt black hole

At the helm of Zhao Weiguo, Ziguang group has been making great progress.

Under the huge capital empire, some crises are hidden. If we resume the financial situation of purple light in recent years, it is not difficult to find that the chip giant's life is not easy, almost all in high debt operation.

According to the information disclosed by Ziguang group in the past: as of the end of 2017, the end of 2018, the end of 2019 and the first half of 2020, the asset liability ratio of the company's consolidated statements was 62.09%, 73.42%, 73.46% and 68.41%, respectively, and the company's debt ratio remained high for a long time.

By the end of the third quarter of 2020, the total assets of Ziguang group were 300.753 billion yuan, and the total liabilities were 210.686 billion yuan. During the same period, the net cash flow from operating activities was 1.012 billion yuan, the monetary capital was 50.555 billion yuan, the short-term borrowing was 35.798 billion yuan, and the non current liabilities due within one year were 38.883 billion yuan.

Although the total assets amount to 300 billion yuan, the total liabilities are also as high as 200 billion yuan. The shortage of liquidity directly leads to the uncertainty of bond repayment.

An episode before the substantial debt default is that after the successful acquisition of linxens, Ziguang group hopes to incorporate it into the listed company Ziguang Guowei, so as to realize the capitalization of the assets acquired overseas in the Chinese market. But after two years, in June 2020, the 18 billion yuan merger was rejected by the CSRC.

This seems to indicate that Zhao Weiguo's previous M & a path is no longer favored. Zhao Weiguo's "luck" is not so good.

Four months later, on October 29, 2020, Ziguang group decided not to exercise the redemption right of "15 Ziguang ppn006" perpetual bonds. This announcement, officially triggered the purple light group debt crisis "black hole".

Since then, Ziguang group has continuously defaulted on due debts. According to the announcement on the follow-up progress of corporate bond default issued on June 30, "16 Ziguang 01", "16 Ziguang 02", "17 Ziguang 03", "18 Ziguang 04", "19 Ziguang 01" and "19 Ziguang 02" were in default. The current default principal and interest of Ziguang group are about RMB 6.883 billion, and there is still a bond of RMB 1.3 billion due at the end of December this year.

At the same time, rating agencies have lowered the ratings of Ziguang group and corresponding bonds. As of June 30, 2021, China integrity international has reduced the credit rating of Ziguang group's main body to C, and reduced the debt credit rating of "16 Ziguang 01", "16 Ziguang 02" and "19 Ziguang 02" to "C".

Today, Huishang bank, the creditor of Ziguang Guowei, applied to Beijing first intermediate people's court for bankruptcy reorganization of Ziguang group. The two listed companies of Ziguang group, Ziguang shares and Ziguang Guowei, have also announced in succession. It is uncertain whether the reorganization application put forward by creditors is accepted by the court and whether the Ziguang group will enter the reorganization procedure is still uncertain.

Ziguang group a share territory breakdown

After a series of mergers and acquisitions mentioned above, as a chip giant with 300 billion assets, Ziguang group's capital layout in a shares is deeply intertwined.

According to the statistics of 21st century economic report, the A-share companies directly and indirectly held by Ziguang group include: Ziguang Guowei (002049), Ziguang shares (000938), XueDa Education (000526), Haobai holding (600640), Tongfang shares (600100), Zhongxin tourism (002707), Wenyi Technology (600520), Western securities (002673), and * ST Jintai (600385), Involved in communication electronics, medicine, education, electrical machinery, finance and other fields.

If Ziguang group really goes to bankruptcy reorganization, what will happen to him and its listed companies?

"According to the provisions of the bankruptcy law, the court shall, after accepting a creditor's bankruptcy case, appoint a bankruptcy administrator to take over the property of the bankrupt enterprise for liquidation. This work is mainly divided into creditor's rights and debts. After the completion of this part of the work, the administrator shall notify the creditors to hold a creditors' meeting to confirm the creditor's rights, debts and bankruptcy property of the bankrupt enterprise. " Yu Jiong, a lawyer with Shanghai Gongyi law firm, said in an interview with 21st century economic reporter.

"If the bankrupt enterprise has the opportunity to restructure, for example, if the creditors reach an agreement to exempt part of the debts, and at the same time allow the other debts to be paid in installments, and the debtor is allowed to produce again in accordance with the resolution of the creditors' meeting, the reorganization can be carried out. In this case, the purple light group may be saved, perhaps through bankruptcy reorganization to get Phoenix Nirvana opportunity. " Yu Jiong said.

"But if the creditor fails to reach an agreement or the amount of debt is too large, even if part of the debt is exempted and still unable to repay, the court can only rule bankruptcy. If the court adjudicates bankruptcy, it will determine at the same time the amount of bankruptcy property and the amount of creditor's rights, and the creditors shall pay off in proportion. As for the enterprise's foreign investment, that is, equity, it belongs to bankruptcy property and should be publicly auctioned. The proceeds of the auction shall be distributed by the creditors. " He continued.

Pacific Securities pointed out in the research report analysis that due to the large debt scale of Ziguang group, the number of foreign debt holders in China, and the complex debt relationship, the adoption of general negotiation means will inevitably lead to the situation of long time-consuming and low efficiency. Therefore, it is a professional choice to start judicial reorganization, which is conducive to accelerating the consensus of different creditors' demands. Through judicial reorganization to determine the rights and interests of creditors, on the one hand, it is convenient to reach a final plan with investors as soon as possible; On the other hand, it is also convenient for investors to determine the plan.

According to the latest information, Ziguang group may be actively seeking debt solutions.

On July 13, market news said that Ziguang group, which has about $31 billion of debt, is seeking to sell its 46.45% stake in Ziguang shares as more bonds are about to mature. Alibaba group and several government backed companies are considering a stake in Ziguang, which could be as high as 50 billion yuan.

According to the announcement on the application for restructuring of indirect controlling shareholders issued by Ziguang Guowei and Ziguang shares on July 9, if Ziguang group enters the reorganization procedure, the restructuring plan will indeed have an impact on its equity structure.

As of the announcement date, Tibet Ziguang Chunhua Investment Co., Ltd., a wholly-owned subsidiary of Ziguang group, holds 32.39% of the shares of Ziguang Guowei, while Tibet Ziguang communication Investment Co., Ltd., a wholly-owned subsidiary of Ziguang group, holds 46.45% of the shares of Ziguang.

In addition, Ziguang zhanrui, which is seeking IPO, also made a statement on this matter. "Ziguang group is one of the shareholders of zhanrui, accounting for 35.23%. Ziguang group does not directly participate in the business operation and decision-making of zhanrui. At present, we have not found that the announcement will have a direct impact on zhanrui's current production and operation activities. "

In fact, the 21st century economic reporter noticed that before the full outbreak of the debt crisis, Ziguang group had concentrated on selling equity to solve the urgent need. At the beginning of 2020, Ziguang group concentrated on selling the stocks of four companies, namely Zhongxin tourism, Wenyi technology, Western securities and * ST Jintai, with an estimated cash withdrawal of 150 million yuan, 884 million yuan, 559 million yuan and 28 01400 yuan respectively. It's just a drop in the bucket for 200 billion debt.

The bankruptcy and reorganization of star schools and enterprises

When talking about the bankruptcy reorganization of Ziguang group, an Guangyong, an expert of credit management committee of all China Association of mergers and acquisitions, analyzed in an interview with the reporter of 21st century economic report that this was caused by changes in internal and external environment. From the external environment, some western developed countries have targeted the attack and layout of China's semiconductor industry. The talent training and technology accumulation of semiconductor industry can not be achieved by spending money in one or two years.

"In addition, there are also many problems in the risk management and strategic level of the enterprise itself, which eventually leads to the bankruptcy and reorganization of Ziguang." He said.

For its listed companies, although all parties respond to normal operation, an Guangyong believes that the impact can not be avoided, "because the sensitivity and volatility of the stock market is much higher than the actual production line."

What makes the market think deeply is why founder of Peking University and Ziguang of Tsinghua University, which have more resources, will go bankrupt and restructure one after another. What causes these famous universities and enterprises to go to such an embarrassing situation?

"They are all diversified businesses with high leverage and no focus. The listed companies such as Ziguang and founder should have walked on two legs. One leg is the technological path. Relying on the good scientific research environment of the University, we can take out scientific research achievements and apply them to the market through the way of enterprises. The other leg is merger and acquisition. Through the strength of our own financial college, we set up investment funds and carry out academic investment. In fact, some foreign campus funds have good investment returns, that is, to be an engineer, Or be a capitalist. " Pan Helin, executive director and professor of Digital Economy Research Institute of Central South University of Finance and law, pointed out in an interview.

"But the problem with Ziguang and founder is that they are making capital investment in the way of engineers. Their investment content is a lot of yuan, but they have not settled into high-end fields, and have not settled down to overcome the difficulties of cutting-edge technology. Instead, they have become more and more diversified and entered some inefficient leading areas. At the same time, in order to diversify, they continue to borrow, thus increasing their assets. " He added, "the best way for companies like Ziguang and founder is to start a business with technology, and do R & D in light of capital, instead of chasing hot spots. Docking with industry university research institute, we should give full play to our own technical expertise step by step, and adopt the mode of integration of industry, University and research. "

An Guangyong said, "even if we have the top conditions, such as relying on the R & D resources of top domestic universities such as Tsinghua University and Peking University, and the strong support of the government at the policy level, if we violate the rules of the market, we will go bankrupt."

There is a view that there is a special system in school enterprise management. In 2016, when Ziguang group made a large-scale merger and acquisition, some state-owned assets experts pointed out that "asset management under the system of the Ministry of education has its particularity, which is different from the general environment. It can only be said that it is a complete special case, which is very difficult to appear under the strict state-owned assets supervision system."

How to treat the relationship between Ziguang and the government? Zhao Weiguo once said that Ziguang is a market-oriented enterprise, and its growth mainly comes from the market. As far as government relations are concerned, the most important thing for Ziguang is to let the government understand what it has done, which is in line with the national strategy; Ziguang's support from the government is no different from other high-tech enterprises.

It is true that the development of purple light in recent years is closely related to the development of the country. It accurately grasps the trend of national policies and carries out a series of operations as a state-owned enterprise.

Under the leadership of Zhao Weiguo, Ziguang's M & A of several chip companies has improved the overall level of China's chip industry and, to a certain extent, rewritten the pattern of China's chip industry. But a situation that can not be ignored is that almost none of Ziguang's enterprises rely on the scientific and technological strength of Tsinghua University, and the technical problems can not be solved by capital operation.

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