Chinese clothing turned into fertilizer company

Following the announcement of the plan in March, the restructuring of the Chinese clothing (000902.SZ) has finally made substantial progress in recent days.

On the 27th of this month, China's garments issued an acquisition report, projects involved in asset replacement and asset assessment reports, etc. It officially confirmed the use of asset replacement methods to dispose of all existing assets and liabilities of Chinese clothing, and to The 100% equity interest of Xinyangfeng Fertilizer held by 45 natural persons such as shares and Yang Caixue was injected into the listed company.

In addition, China Apparel will also issue 344 million shares in stocks of 45 natural persons such as Yang Feng and Yang Caixue to purchase the difference between their respective holdings of assets and placement of assets.

After the transaction is completed, Yangfeng will hold 290 million shares of China's apparel, and 48.24% of the total share capital after the release of the national apparel. It will become the largest shareholder, and China's clothing will also be turned into a private enterprise by the state-controlled listed company. In terms of business, the main business of China's apparel industry will also transform its former textile printing and dyeing and textile trading business into R&D, production and sales of phosphorus compound fertilizers.

Loss again and again Chinese clothing "shelling off"

Before the announcement of the acquisition report, China Garment just released its 2013 semi-annual performance forecast. It is expected that the net loss attributable to the shareholders of the listed company in the first half of the year will be 25 million to 30 million yuan. The amount of losses in the same period last year was 18,905,400 yuan.

In 2012, China's apparel operating revenue was 1.565 billion yuan, a year-on-year decrease of 11.82%, and the net loss attributable to shareholders of listed companies was 44.174 million yuan, a significant drop of 1608.32% compared with the same period of last year. At the same time, inventory at the end of 2012 also rose by 10.13% compared with 2011, reaching 245 million yuan, accounting for more than 20% of total assets.

With high inventory levels and poor performance, China's garments in distress began to find a way out. The acquisition of Yangfeng Stock is not its first attempt.

Established in 2004, Xinyangfeng Fertilizer Co., Ltd. is a large-scale phosphorus chemical company with high-concentration compound fertilizer as the leading product. It has total assets of 5.5 billion yuan and annual output of 5.4 million tons of phosphorus compound fertilizer. In the last three years, the profit of Xinyang Fengfei Industry was 382 million yuan, 476 million yuan and 371 million yuan respectively.

However, it is worth noting that Yangfeng does not inject the phosphate mineral assets with attractive and valuable values ​​into Chinese clothing. At the end of February this year, Xinyang Fengfei Industry transferred all of its 100% stake in New Yangfeng Mining to Yangfeng.

At present, there are 9 wholly-owned and equity-shared companies that have been identified as injecting into China's apparel industry. The main business is the downstream production and sales of the phosphate fertilizer industry.

Low performance textile companies are frequently "backdoored"

The textile companies whose main business is completely changed and “backdoored” are not just Chinese clothing.

Starting from the beginning of this year, China Resources Jinhua (000810.SZ), which specializes in spinning and weaving, began to issue announcements stating that the company will reorganize its assets through asset sales, replacements, and issuance of shares to purchase assets, Skyworth’s Skyworth The figures will also be listed on the backdoor through the acquisition of China Resources Jinhua.

In addition, TIANSHAN TEXTILE (000813.SZ), which is mainly engaged in the wool spinning business, also embarked on the reorganization road since 2010. It has submitted to the China Securities Regulatory Commission a plan to increase the stake in the acquisition of Xituo Mining for the third time. The business is expanded to develop and produce mineral resources.

Demian Co., Ltd. (002702.SZ) was converted from a cotton textile company to a real estate company as early as in 2009. Shanghai Aijia Investment Holdings Co., Ltd.'s Ai Jia Hao Ting also made a public offering by capital injection.

Behind the frequent "backdoor" is the overall downturn in the textile and apparel industry and the decline in corporate performance.

Take China Resources Jinhua as an example. Since 2010, the company’s total operating income has barely increased, and its net profit has rapidly dropped from RMB 82.04 million to 3.53 million. Similar to Chinese clothing, the loss of Tianshan Textile in 2012 also reached more than 13 million yuan.

Judging from the recent half-year results announced in 2013, the net losses of textile companies such as Lan Ding Holdings (000971.SZ), Veken Elite (600152.SH) and San Maopai Shen (000779.SZ) all exceeded 10 million yuan. , Changshan shares (000158.SZ) even reached a loss of 34 million to 36 million yuan.

Lin Yifan, director of Brand Consulting Center of Brand Consulting Co., Ltd., told the China Business News that the domestic apparel industry is currently experiencing a severe downturn due to sharp rises in rental and human capital and high inventory levels. The upper reaches of the textile industry have been affected. The most direct impact, he said, "this situation will continue for some time, the phenomenon of acquisitions, backdoors will also appear frequently."

Some industry sources pointed out to reporters that the number of textile and apparel companies on the market had been excessive and dispersive. The changes that have taken place are just a normal process of pooling quality resources and eliminating backward production capacity.