Sinochem Group sells its assets at a price of nearly 600 million

On June 23, the Beijing Equity Exchange issued two announcements on the transfer of property rights. Sinochem Group intends to transfer 20.62% of the equity of Modern Seed Industry Development Fund Co., Ltd. (hereinafter referred to as "Seed Industry Fund") for RMB 575 million to RMB 16.0154 million. Transfered 24.75% of Beijing Xiannong Investment Management Co., Ltd. (hereinafter referred to as "Xiannong Investment").

Xiannong Investment's official website shows that the company was established in Beijing in January 2013 as an entrusted management agency for seed industry funds.

For these two equity transfers, Ms. Guo, a staff member of the trading agency, stated that this was a withdrawal decision made by Sinochem Group based on strategic needs. The pricing was based on the state-owned assets assessment standard.

The transfer information shows that the seed industry fund was initiated and set up by the Ministry of Finance, China Agricultural Development Bank, and Sinochem Group. Currently, the Ministry of Finance and the Agricultural Development Bank hold 39.69% of the shares, and Sinochem Group holds 20.62% of the shares. Xiannong Investment was jointly established by the Agricultural Development Bank, Sinochem Group and Kwai Hing Investment Co., Ltd., holding 67%, 24.75% and 8.25% of the shares respectively.

In 2019, the seed industry fund generated revenue of 160 million yuan, net profit of 52.52 million yuan, total assets of 2.65 billion yuan, and net assets of 2.62 billion yuan. Xiannong Investment has revenue of 44.12 million yuan, net profit of 14.47 million yuan, total assets of 82.9 million yuan, and net assets of 67.03 million yuan.

The transfer information shows that the intended transferee should have good financial situation and ability to pay, as well as good business credit. The project does not accept joint transfers.

Ms. Guo introduced that at present, it is still in the process of docking with the exchange, and there are not too many requirements for the buyer's qualification. After the pre-disclosure is completed and other internal procedures are completed, it will be officially listed, and the interested party can refer to the relevant information. Ms. Guo said it was inconvenient to disclose how many interested parties are currently.　　

Tianyan check shows that the registered capital of seed industry fund is more than 2.4 billion yuan, and has invested in many seed industry companies in Shanghai, Jiangsu, Anhui, Hunan, Henan and other provinces. Among them, Henan Qiule Seed Industry Technology Co., Ltd. recently applied for the Science and Technology Board IPO and was accepted by the Shanghai Stock Exchange.

Meng Cao Ecology (300355.SZ) also announced recently: "The company and Xiannong Investment signed an "Investment of Intent". Through active contact, the two parties intend to invest in Inner Mongolia Meng Cao Grass Seed, a wholly-owned subsidiary of Meng Cao Ecology through fund equity investment. Industry Co., Ltd. investment. The total investment does not exceed RMB 100 million (including this number), and the specific investment amount and investment time will be separately negotiated by both parties. Xiannong Investment is the first domestic market-oriented operation with government background approved by the state. Seed industry investment and financing platform."　　

Xiannong Investment is also the manager of the private equity and venture capital funds filed with the China Foundation Association. It is currently operating a fund and the company's legal representative is Ye Li.

The reporter noted that Ye Li had held important positions in Sinochem Group and China Agricultural Development Bank. If the equity transfer of Xiannong Investment succeeds, will her position be adjusted and will she return to Sinochem? On June 23, the reporter contacted Ye Li through Xiannong Investment staff. She said she was not in the company recently and could not be interviewed.

According to Sinochem Group's official website, the company is a central enterprise, ranking 88th in the Fortune Global 500 in 2019, and has five major business units: energy, chemical, agriculture, real estate and finance. In addition to the modern seed industry fund, Sinochem Group's financial map also includes Noon Fund, China Foreign Economic and Trade Trust, Zhonghong Life Insurance, Far East Horizon Co., Ltd. and Sinochem Group Finance Company.

On June 23, 2020, the reporter sent a letter to Sinochem Group for an interview, asking the company why the sale of the above financial assets was intended to shrink the financial landscape and focus on the main businesses of energy, chemical and agriculture. Mr. Chen, the group office, told reporters that the interview letter had been forwarded to relevant leaders and business departments. As of press time, the reporter has not received a reply.　

In June 2019, Sinochem Group's internal journal "New Sinochem" published an article by Li Qiang from the Financial Division, indicating that in the financial sector, Sinochem Group has two target companies-Ping An and China Aviation Capital. "The financial business department should play multiple roles such as profit support, financing services, internal investment banking, and investment assistance, and help Sinochem become China's BASF with high-quality industrial financial services."