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Beiqi Foton officially listed the 67% stake in Borgward

Beiqi Foton officially listed the 67% stake in Borgward

From January to August this year, Borgward’s net profit loss was approximately 1,649 billion yuan, the equity transferee was required to repay 4,271 billion arrears for Borgward.

On November 23rd, Beiqi Foton Motor Co., Ltd. (abbreviated as Beiqi Foton) officially listed 67% equity of Beijing Borgward Vehicles Co., Ltd. (abbreviated as Borgward vehicles), and the reserve price was about 3,973 billion yuan. It is also mentioned in the trading conditions that the transferee must repay the transferor's loan and interest of 4,271 billion yuan within 3 years from the date of completion of the equity transfer (ie, the completion of the industrial and commercial change registration).

The Beijing News reporter inquired on Tianyan. Up to now, the ownership structure of Borgward vehicles has not changed, and it is still 100% owned by Beiqi Foton. If the listing transaction is completed, the equity of Borgward held by Beiqi Foton will be adjusted to 33% and will no longer be included in the scope of the company's consolidated statements.

At present, the operation status of Borgward vehicles itself is not optimistic. According to the announcement of Beiqi Foton on October 9th this year shows that in 2017, Borgward vehicles assets totaled 5,039 billion yuan, and the total liabilities were about 3,904 billion yuan. It was 1,135 billion yuan, operating income was 5,096 billion yuan, operating profit loss was about 255 million yuan, and net profit loss was about 275 million yuan. From January to August 2018, Borgward vehicles' operating income was 2,267 billion yuan, operating profit loss was 1,647 billion yuan, and net profit loss was about 1,649 billion yuan.

In addition, Borgward 67% equity transfer announcement issued on the website of Beijing Equity Exchange mentioned that as of August 31st this year, Borgward vehicles owed BAIC Foton a loan amount of 4,271 billion yuan. If you want to take over Borgward vehicles, the transferee will not only accept the transfer price of 3,973 billion yuan, but also repay the debt of 4,271 billion yuan within 3 years.

Since the beginning of the pre-disclosure period of equity transfer on October 9th, the rumors about who will pick up Borgward vehicles have been constant. Shenzhou UCAR, Evergrande, etc. have appeared on the list of takers, but they were all denied by BAIC Foton.

On October 31st, BAIC Foton issued a clarification announcement that the current 67% equity transfer of Borgward vehicles is in the pre-listing period and there has not been any substantial progress. At the same time, BAIC Foton also stressed that the media reports that “ Evergrande is in contact with Foton Motor’s target of 67%” and “from FF to Borgward, Evergrande is in contact with Foton Motor” are not true. Evergrande has not been in contact with the company regarding the transfer of Borgward shares.

Although the market has not yet appeared, but for Borgward vehicles, the equity transfer is particularly important. As BAIC Foton said, on the one hand, the transfer of equity is conducive to the introduction of diversified capital investment to ensure the long-term sustainable development of Borgward vehicles. On the other hand, it also helps the company focus on the core business of commercial vehicles.