Sun Hongbin hopes that after this capital increase, it will have absolute control over LeTV and LeTV, and may invest in it later to revitalize its existing core assets.
According to Rongchuang China semi-annual report shows that at present, Sunac China more cash flow, while there are still some hands on sales projects, billions of additional capital increase is not difficult.
About Sun Hongbin this time to plan to increase their investment as a new music and music video industry's purpose is 'to stabilize the listed company'.
For the current status of music as worse, Sun Hongbin finally intended substantive shot.
Tencent "Prism" from a number of independent sources was informed that Sun Hongbin, chairman of Sunac China (1918.HK) has recently launched a music on the new Electronic Technology (Tianjin) Co., Ltd. (referred to as' LeTV (Beijing) Co., Ltd. ("LeTV") plans to increase its capital and share, involving billions of dollars.
According to people familiar with Tencent's Prism said Sun Hongbin hopes that after the capital increase, it will have absolute control over LeTV and LeTV, and may thereafter invest in it to revitalize its existing core assets.
For the capital increase will involve other employers, as well as specific sources of funding, Tencent Finance "Prism" yet to get any further information.But different sources have told Tencent Finance "prism", Sun Hongbin is actually very much hope that Finding some employers to 'endorse', but there is no final conclusion.
Tencent Finance Prism contacted Sunac China many times and did not get any response as of press release. LeTV Zhixin and LeTV have expressed their opinions on the "Prism" of Tencent Finance. All the announcements shall prevail.
Billions of capital increase come from?
Tencent Finance "Prism" was informed two months ago that Sunac China was halted by financial institution China Huarong in late September as all new financing requirements were halted. Subsequently, Sunac China was reportedly suspended by financial institutions such as the Bank of China Provide financing services.This means that Sun Hongbin and Sunac China in the foreseeable future financing will be very difficult.
In the meantime, Sun Hongbin paid 29.4 billion yuan for the purchase of Wanda assets in the past few months, so where is the money raised and the music video come from?
Although Tencent Finance "Prism" temporarily can not be informed that the sponsor is Sun Hongbin or Sunac China, but for both parties, billions of capital increase, it seems not difficult.
(On November 5, Sun Hongbin, at the 'New Era Summit Forum on New Future' hosted by the Association of Entrepreneurs' Summit in Beijing, said that while investing in LeTV is logical, the biggest problem with LeTV is the management issue. Photo by Xiao Haiqiang)
Sun Hongbin's major assets are concentrated in Sunac China According to the third quarter results released on August 31, 2017, Sunac China posted a net profit of 1.3 billion yuan in the past six months and a debt-to-liability ratio of 390 %.
However, Sunac China's cash flow is very impressive .In mid-2017 report, Sunac China cash and cash equivalents (including restricted cash) up to 92.41 billion yuan, of which non-restricted cash of 706.6 billion yuan However, the mid-year report also mentioned And, in the non-restricted part of the cash, the amount of financing received as high as 57.21 billion yuan.
A number of financial circles on the Tencent Finance "Prism" analysis, as a real estate developer, Sun Hongbin hands a lot of sales projects, one-time additional music as a new music and music video billions, is not difficult.
October 26, Tencent Finance "Prism" had exclusive access to Wanda or Wanda Music News will be news.If you do so, the new strategic investors will also be possible to Sunhongbin capital increase funding.
'Stabilize' the listed company
About Sun Hongbin plans to capital increase this time as a new music and music as the purpose of the film, a different source told Tencent Finance "Prism" is "in order to stabilize the listed company."
Currently, the listed company LeTV holds a 40.31% stake in LeTV, which is also incorporated into the earnings of listed companies. Semi-annual report of 2017 shows that LeTV incurred a new revenue of RMB4.653 billion and a net loss of RMB282 million. But also led to the music show amusement as the result of a new loss.In the meantime, the mid-year report also shows that music net inventory amounted to 1.44 billion yuan, inventory balance increased 52.32% over the end of 2016. This is mainly due to music as the first half of the new inventory increase Caused by the goods.
According to the 2017 mid-year report, LeTV terminal business revenue in the first half of 2.36 billion yuan, down 54% from last year, but still in operating income Accounting for 42.61% of the proportion.This means that the music Watch as the new dependence on music is still great.
At the same time, the situation of music and video industry is not good.According to the announcement of Rongchuang China before 2016, LeTV net profit of only 145 million yuan.This data is less than before the start of the acquisition of music network Music as promised when the film industry 520 million yuan 1/4.
Since the beginning of this year, many movies under the music video industry have poor box office, and only "Gangren Boqi" has a box office worth over 100 million yuan, and the valuation of the music video industry is also seriously deteriorating.
Suspended for six months, LeTV again announced the restructuring plan last month, the subject matter is still music as the film industry, but many financial circles on the Tencent Finance "Prism" that does not look good this restructuring.Currently, the performance of music as the film industry Poor, but also the acquisition of the main music Watch continued losses, supervision in the more and more stringent now, want to obtain regulatory approval is not easy.
According to people familiar with the situation, this is where Sun Hongbin needs to achieve a goal of "stabilizing the music and watch the Internet" through increasing the number of music videos and music videos. In his opinion, if music and new things can continue to increase order production after the capital increase, For profit, you can drive the music company listed on the revenue and profit increase.
In fact, in order to save the music as the new look, Sun Hongbin already had a substantive move.On November 14, it was reported that Sunac China has informed the various branches, if the need to configure the new TV preferred music brand, To help music to the new stock.
(Rongchuang Group on the allocation of music and television companies notice)
In the meantime, the music video industry is also able to restart its new business and generate new revenue after its capital increase - which paves the way for the subsequent acquisition of listed companies to tie the music industry's profits to the music network.
More people familiar with the process told Tencent Finance "Prism", because the legal requirements of the lengthy process, it is too late to inject capital into the listed company.So Hongbin choose to add music as a new music and music video industry, pending the next asset restructuring can be turned into a music network shares .
Sun Hongbin plan absolute control
Different sources tell Tencent Finance "Prism", in addition to stabilize the listed company, Sun Hongbin the most direct purpose is to get music as new and music video industry's absolute control.
Earlier this year, Sunac China invested approximately 16.8 billion yuan into LeTV, LeTV and LeTV through equity transfer, capital increase and share expansion, among which, Suntron achieved 33.4959% stake in LeTV and 15% of music video industry.
However, in April of this year, according to business statistics, Rongchuang actually held 21% of the music industry in China, only 0.81% less than the largest shareholder of LeTV as the controlling shareholder. Jiayuenting is the actual controller of LeTV Holdings, Holding 92.07% of the shares, its sister Jia Yuefang holds 1.5% stake in LeTV.
(On the evening of August 31, the share of shareholders disclosed in the circular issued by Sunac China announced in the investment)
In fact, Sun Hongbin has long mastered the LeTV system, which includes LeTV and LeTV. However, according to business information, it has not yet completely controlled the LeTV industry and LeTV's innovation. According to informed sources, this is also the case initiated by Sun Hongbin The main purpose of capital increase.
Although Jiayue Ting was busy with FF's financing matters, several trips to and from Hong Kong and the United States have not returned, but Tencent Finance Prism said recently that Sun Hongbin has met with Jia Youting, Music video industry reached a consensus in view of Jiayue Ting and music as the current capital situation, must have no strength to continue to follow Sun Hongbin plans to raise the issue of capital increase.This means that the capital increase will actually be Jiayue Ting shares diluted.
At present, most of the old musicians under the leadership of Jia Yueting have already quit, including Jiayuenting capable cadres - LeTV to the new CEO and LeTV CEO Liang Jun.
Music as the new is from Zhang Zhiwei at the helm, while the music as the film is still Zhang Zhao presided over. Sun Hongbin already started his own music in the personnel arrangements .Tencent Finance "Prism" was informed that Sun Hongbin is currently very optimistic about Zhang Zhao. In late October, Music Watch newly established management committee, as chairman of the board is exactly Zhang Zhao.