On May 16, Dongfeng Motor's strategic reorganization of Fuqi Group made Golden Dragon, which had been silent for a long time, unexpectedly “blushing†in the capital market. In fact, from the beginning of April this year, the stock with a stock price of only 7.15 yuan went all the way up until it reached a rare 10.39 yuan on May 17 before it stopped the rise.
Xiamen Golden Dragon Automotive Group Co., Ltd. (namely, Golden Dragon Auto) is the only auto asset under the Fuzhou Automotive Group to achieve profitability, except for Southeast Auto. Compared with Southeast China, which has flat sales in the past two years, Jinlong Automobile, which owns Xiamen Golden Dragon, Xiamen Golden Brigade and Suzhou Golden Dragon “Three Dragons,†has been at the frontline of the domestic passenger car industry and directly competes with Yutong Bus. The best quality business assets of Fuqi Group.
“Bus business has always been a shortcoming of Dongfeng. If Golden Dragon Auto is retired under strategic reorganization with Fuqi, the Group’s independent business segment will be substantially enhanced,†said an informed source familiar with Golden Dragon Motors. The realization of the "grand autonomy" strategy is the core objective of Dongfeng Motor in recent years. The reorganization with Southeast Automotive Industry has also been interpreted by the industry as the prescribed action taken by Dongfeng to achieve this goal.
However, the desire of Dongfeng Motor directly threatens the interests of local governments. “Actually, the actual controller of Golden Dragon Motors is not Fuqi Group, but the Xiamen State-owned Assets Supervision and Administration Commission. Dongfeng wants to inquire about Jinlong's business and cannot negotiate with Xiamen Municipal Government.†said Cao He, chief analyst of National Securities Auto Industry. .
From the strategic cooperation framework agreement signed by Dongfeng and Fuzhou on May 16th, in the early stages of restructuring, Dongfeng’s goal was only limited to being the actual controller of Southeast Motor. The integration of projects such as Golden Dragon Motors and Fujian Benz will not wait until Dongfeng holds more than 60% of Fuzhou Auto's shares and becomes its controlling shareholder.
This undoubtedly provided time for Xiamen to fight for greater bargaining chips. On the eve of the signing of the strategic cooperation agreement between Dongfeng and Fuzhou on May 16, Jinlong Automobile suddenly announced on the evening of May 14 that the Xiamen State-owned Assets Supervision and Administration Commission planned to transfer the entire electronic equipment company of Xiamen City, which was entrusted by the company, to free transfer. To sea wing group. After the transfer of shares, Haiyi Group will hold 20.70% of the shares of Golden Dragon Motors, which exceeds 13.52% of the shares held by Fuzhou Automobile Group, becoming the largest shareholder of Golden Dragon Motors.
Fugitive blessing
“The major shareholder is easy to change and it is sooner or later for Jinlong Motor,†Cao He told reporters. In September 2001, in order to make the Fujian automobile industry bigger and stronger, the Fujian Automobile Administration Department intended to use the listed company of Golden Dragon Motors to integrate Fujian automobile resources. At this time, Fuqi also transferred 17% of Golden Dragon to the Finance Bureau of Xiamen City without compensation. Car equity became the company’s largest shareholder.
However, after the blessing of Fuqi Jinlong, Jinlong did not realize the dream of the Fujian Provincial Government to integrate the automotive industry. Instead, it was “kicked†out of the “cabinet†due to the contradiction with Xiamen’s state-owned asset investment company.
The watershed of the power struggle is the first extraordinary shareholders’ meeting of Golden Dragon Motor in 2004. The meeting reviewed and passed two proposals on the re-election of some directors and the addition of independent directors. Ye Tianjie from Xiamen State-owned Assets Investment Corporation was elected as the chairman and Zhu Jianzhong from Fuqi Group was elected as the vice chairman. The former directors of Fuqi Group, such as Ling Yuzhang and Wang Zhiyong, will no longer serve as directors, which means that although Fuqi Group still maintains its position as the largest shareholder of the company, it has actually lost its right to the actual management of Jinlong Automobile. .
“From this time onwards, Fuqi basically did not participate in the operation of Golden Dragon Motors, but it was the name of the first largest shareholder. As long as they were willing, Xiamen would be able to recapture the position of the largest shareholder at any time.†said Cao He. After the power was seized, Xiamen Haiyi Group, a state-owned enterprise directly under Xiamen’s control, was the second largest shareholder of Golden Dragon Motors, but it was the actual controller of Golden Dragon Motor as it was entrusted by Daimlamo Group, the largest shareholder, to take over the supervisory authority.
Nine years later, Dongfeng and Fuqi’s reorganization plan finally led Xiamen to take substantive actions. On the evening of May 14, Jinlong Automobile announced that the Xiamen Municipal Government had studied the assets reorganization of the Xiamen state-owned wholly-owned company Xiamen Shuncheng Asset Management Co., Ltd. (the Shuncheng Company) under the Xiamen State-owned Assets Supervision and Administration Commission. Xiamen Electronic Equipment Co., Ltd., under the management of Shunyi Company, was transferred to Haiyi Group at no cost. Xiamen Electronic Equipment Co., Ltd. is the third largest shareholder of Golden Dragon Motors, holding 7.68% of the shares.
After this transfer of shares, Haiyi Group successfully passed Fuqi and became the first shareholder of Jinlong Auto with 20.70% of the shares. From the capital relationship, it effectively avoided the competition between Dongfeng and other companies for the controlling stake in Jinlong Automobile, and Jinlong The interior of the car will not undergo substantive changes due to the change in this major shareholder.
“In fact, in the process of the negotiations between Fuqi and Dongfeng, the Xiamen government was in a marginalized role. In order to maximize the interest, Xiamen chose to issue an equity allocation announcement the day before the reorganization of Dongfu. Want to remind Dongfeng, in order to restructure the dragon, must negotiate with the Xiamen side." Informed sources said.
The size of Jinlong integration started again?
Equity allocation may be the first step taken by Xiamen to Jinlong Motors. "In the future, the Xiamen municipal government may again launch the integration plan for Daikin and Xiaolong to strengthen the capital for negotiations with Dongfeng Motor," said the person familiar with the matter.
In the passenger vehicle industry, Xiamen Jinlong United Automotive Industry Co., Ltd. is known as the Grand Dragon, and Xiamen Kinglong Wagon Co., Ltd. is known as Xiao Jinlong. Although the two companies are independent, they are from the same major shareholder, Xiamen Automobile Co., Ltd. That is, Xiamen Automobile. In 2005, Xiamen Automobile was renamed Jinlong Automobile.
As early as in 2004, in order to make the Xiamen auto industry bigger and stronger, the Xiamen local government has plans to integrate large and small dragons. At that time, Xiamen’s plan was to control Dajinlong first, and then integrate two large and small dragons with an overwhelming trend. In order to win the production right under the chassis, a complete vehicle production plant was built to make Xiamen an important part of the southeastern coast. Large-scale automobile manufacturing base.
After many years of planning, Dajinlong has now been under the actual control of Xiamen SASAC. In the past, Xiao Jinlong, who has always been “going alone,†has gradually become integrated due to the decline in business volume in recent years. Especially at the beginning of this year, Chen Jincai, chairman of Sanlong Group, which holds 40% of Xiaojinlong’s shares, suddenly died due to a myocardial infarction, making the company’s shareholding change once again full of imagination.
“An obvious action is that at the 2013 Beijing International Road Transport, Urban Bus and Parts Expo, which will be held on May 22, Da Jin and Xiao Jin Long will jointly participate in the exhibition. This is considered by the industry as two vehicles. The precursor to enterprise consolidation," said people familiar with the situation.
As one of the largest bus chassis manufacturers in China, Dongfeng Motor has not given up its intention to integrate Jinlong Automobile. According to the agreement between Dongfeng Motor and the Fujian Provincial Government, when the sales volume of South East Automobile (including vehicle and engine) is increased to 300,000, the Fujian Provincial State-owned Assets Supervision and Administration Commission will further transfer the shares, and Dongfeng Motor will hold more than 60% of its shares and become a controlling shareholder. The integration of Jinlong Motors, Fujian Mercedes-Benz and other projects will follow.
“Before this, if Xiamen can complete the integration of large and small Jinlong, it will undoubtedly increase Dongfeng’s acquisition cost. Once Xiamen reluctantly integrates Dongfeng with Jinlong, 10 years ago, the relationship between Fuqi and Xiamen to Golden Dragon was launched. Equity battles will likely take place between Dongfeng and Xiamen," said a securities analyst who declined to be named.
However, it is certain that once Dongfeng joins hands with Jinlong, the passenger vehicle chassis production capacity of the former will integrate the vehicle production capacity of Jinlong Automobile and will bring the most powerful challenge to Yutong Motor, the current leader of the bus industry.
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