The transaction menu includes 23.9 million square meters and a hidden 36 million square meters of land reserve.
On November 27, Sunac announced an announcement confirming the acquisition of the subsidiary of the Yunnan Urban Investment Group, Global Century (Chengdu Global Century Convention and Exhibition Tourism Group Co., Ltd.) and Times Global (Chengdu Times Global Industry Co., Ltd.) each has 51% equity, with a total transaction value of 15.269 billion yuan. The acquiree currently has 18 real estate projects in cities such as Chengdu, Wuhan, Changsha, and Kunming, with a total construction area of approximately 30.716 million square meters. The other 49% of the shares of Global Century and Times Global are still held by six natural person shareholders, of which Deng Hong holds 23.03%, which is the main lead.
The original equity structure of Chengdu Global Century Exhibition & Tourism Group Co., Ltd.
“Simple” mergers and acquisitions
Sun Hongbin revealed at the media meeting that the first contact with Deng Hong on June 7 was an olive branch proactively offered by the latter. “The most important thing in China is to cooperate with me. Find me through friends. I remember The day of the meeting was the Dragon Boat Festival, and we talked for more than an hour, and basically set it up seven or eight, and then went to drink. “
Global Century and Times Global ’s 51% equity as the transaction target was first listed for sale in September 2019. The listing information shows that the transfer prices of the two target companies were 13.562 billion yuan and 1.707 billion yuan, but they must be “bundled” “.
According to Sunac’s transaction announcement, on November 27, Sunac received a notification of the transaction results of the Yunnan Equity Exchange, confirming the 15.269 billion yuan merger and acquisition transaction. In the agreed agreement between Sunac and Yunnan Urban Investment, Sunac will pay the first equity transaction consideration (about 8 billion yuan) before December 6; before December 27, Yunnan Urban Investment completed the two target companies Equity release pledge registration procedures, and then “January 3, 2020” to assist Sunac Southwest Group in completing the industrial and commercial change registration procedures for the transfer of target equity to Sunac Southwest Group. “Sunac will be fully responsible for Management of 18 companies and 18 projects.
The asset package of the above M & A transaction includes 18 real estate projects with a total construction area of approximately 30.716 million square meters and a saleable construction area of approximately 27.716 million square meters, of which the unsold construction area is approximately 23.910 million square meters.
According to Sun Hongbin, in the merger agreementIn addition, more than 30 million square meters of land has been signed in the cooperation project between the two sides. The investment intent agreement has been signed with the local government, but it has not yet reached the stage of land acquisition.
After Sun Hongbin and Deng Hong met for the first time, the two parties quickly entered a “honeymoon period”. On June 13, the two inspected the Jinning Future City project in Kunming, Yunnan; on July 9, the two appeared together again to discuss the project in Xianning, Hubei. On July 10, a company named Chengdu Global Sunac Culture & Tourism Co., Ltd. (hereinafter referred to as “Chengdu Global Sunac Culture & Tourism”) was registered and listed on the list of shareholders. Sunac Southwest and Chengdu Global Times Convention & Tourism Development Co., Ltd. The legal representatives are 70% and 30% respectively, and the legal representative is Wei Dong, general manager of Sunac China Southwest Regional Group Sichuan Company, and Deng Hong as chairman.
On August 28, Chengdu Global Sunac Cultural Tourism and Yueyang Dongting New City Investment Construction and Development Co., Ltd. jointly established Yueyang Global Sunac Cultural Tourism Investment Co., Ltd., the shares of both parties also accounted for 70% and 30%; September On the 27th, Chengdu Global Rongchuang Cultural Travel and Chengdu Qianli Zhuangdanqi Hotel Management Co., Ltd. jointly established Sichuan Huanrong Qianli Zhuangdanqi Hotel Management Co., Ltd., with equity stakes of 55% and 45% respectively. Traveling thousands of miles is also one of Deng Hong’s related industries.
“The two of us are similar in character. I do n’t know how to account. Old Deng (Deng Hong) does n’t account. The two of us are very simple.” Sun Hongbin said that the two parties will cooperate in three sections: conferences, exhibitions, tourism Town and city complex development, “We (Sunac) have invested a lot of money (in the cultural tourism business), but we have done it for a short time. Old Deng has done it for many years, and the combination of the two of us is invincible.
Deng Hong described the cooperation with Sun Hongbin as his “third entrepreneurship.” In his impression, Sunac is a company whose culture and feelings are hidden by the scale of real estate development, but also reminded that “the cultural tourism town may be different from what you thought before.”
Forgotten counterparty
In a media meeting in Beijing, Yunnan Urban Investment did not appear at the conference site as a transferor of equity.
Yunnan City Investment has been in turmoil this year. In May of this year, Xu Lei, the former chairman of the company, was investigated for serious disciplinary violations. On July 3, Yunnan Chengtou initiated mixed ownership reform. China Poly Group Co., Ltd. entered as a participant, and Poly Group Wei Wei took office as the provincial capital Party secretary and chairman of the investment group.
Later, Yunnan Urban Investment began to “slim down”. On October 21, an announcement issued by Yunnan Urban Investment showed that Yunnan Urban Investment signed a cooperation framework agreement with Guangzhou Jindi Real Estate Development Co., Ltd. (hereinafter referred to as Guangzhou Jindi) and Yunnan Urban Investment Group. “, Intends to agree on the agreement of 60% equity of Xinjiang Heda and corresponding claims, 90% equity of Dongguan Real Estate and corresponding claims, 90% equity of Banner Real Estate and corresponding claims, 90% equity of Guancheng Reform Company and corresponding claims. Transfer to Guangzhou Gemdale by way of transfer or public transfer.
In early November, Yunnan Urban Investment again announced its intention to transfer part of its four subsidiaries’ equity and debt to a wholly-owned subsidiary of Poly Group. The merger and acquisition transaction on November 27 threw off two “boats” and brought 15.269 billion yuan to Yunnan Urban Investment.
These transactions were considered by the industry to be the acceleration of the mixed reform of Yunnan Urban Investment. However, according to the third quarterly data from Yunnan Urban Investment, from January to September this year, the net profit attributable to shareholders of listed companies was a loss of 1.063 billion yuan, a year-on-year decrease of 567.15%; operating income was 4.852 billion yuan, a year-on-year decrease of 30.61%.
Although things have become simpler for Yunnan Chengtou, they are far from land.
It is worth noting that the payment cycle of this M & A transaction is one year, and the payment period of the final balance of 5.269 billion yuan is one year. During the period, Sunac calculates interest on the loan to Yunnan Urban Investment. In addition, within 30 days of the completion of the equity settlement, Chengdu Global Century Exhibition & Tourism Group Co., Ltd. and Chengdu Times Global Industry Co., Ltd. need to distribute approximately RMB 7.143 billion in profits to Sunac Southwest. Collecting one each will reduce the financial pressure on Sunac.
Sun Hongbin explained at the scene that many people were asking Sunac so much for mergers and acquisitions, where did the money come from, “We bought things and didn’t say we hid them at home, we bought and sold them at the same time.” Wanda Cultural Tourism’s 13 projects have so far sold more than 160 billion yuan.