As one of the shareholders of the China Europe International Exchange, on April 13, the relevant person in charge of the Shanghai Stock Exchange responded to hot issues that Qingdao Haier proposed to issue initial public offerings and listing on the China Central E-Stock Exchange's D-share market.
The responsible person stated that the issuance of D shares will help Chinese companies increase their brand awareness in Europe and expand their European business. They will help to make full use of domestic and foreign financing platforms to achieve internationalization strategies overseas. They will help transform cross-border mergers and acquisitions. Upgrade to enhance global competitiveness; Help expand overseas financing channels, Local financing for local use, Reduce exchange rate risk.
On April 10th, Qingdao Haier issued an announcement on the resolutions of the board of directors to propose initial public offering of shares and listing on the China Central E-Stock Exchange's D share market in Frankfurt, Germany (D for Germany, Deutschland).
'Previous planning for the issuance of convertible bonds, and now plans to issue D shares, shows that Haier has great financing needs after acquiring GE's home appliance business. ' An investor told China National Grid that the issuance of D shares is low cost, high efficiency, risk 3. It is one of the important reasons why Haier issues D shares.
However, Liu Buchen, a senior observer of the home appliance industry, thinks that Qingdao Haier’s role in financing the listing of D-shares falls second. The greater significance is that with the opportunity to go public in Germany, it will infiltrate the European market and deepen its global presence and further enhance its overall strength. Competitiveness.
'Three Battles' ahead of schedule
For Chinese home appliance companies and even all companies in the world, the three major markets in China, the United States and Europe mean that their globalization strategy is truly mature.
It must be admitted that although many Chinese home appliance companies have already established manufacturing and design R&D centers in Europe, most Chinese companies still play the role of 'long sleeves' in terms of market share and brand influence. Once Qingdao Haier was successfully listed in Germany, Will gradually in Europe form a manufacturing, design and development, capital, brand and other comprehensive influence.
In the view of Liu Buchen, Qingdao Haier’s issuance of D shares will only have three effects in terms of brand or market: First, Qingdao Haier is expected to be one of the first companies to list D shares in China and Europe. The 'first' effect will bring invaluable communication value for the Haier brand; Secondly, Germany is a 'sacred place' for smart manufacturing, and Europe is one of the global markets with higher barriers to entry. The listing in Germany will accelerate Haier's presence in Europe. Market penetration and global market penetration; Third, the listing in Germany will produce a counter force, promote Haier brand in the Chinese local market reputation.
Independent directors of Qingdao Haier Wu Cheng, Shi Tiantao and Dai Deming stated that this is an issue that is conducive to satisfying the business development needs of the company, optimizing the capital structure, further advancing the company's internationalization strategy, further enhancing the company's operation and management level, and enhancing its core competitiveness.
Insiders believe that in the Chinese domestic market, Haier has already occupied the first position in several categories. In the US market, the synergy effect with GE appliances has become more pronounced. The continued listing of D-shares to consolidate the European market means that compared to other Chinese household appliances. Enterprises, Haier's globalization process has formed a comprehensive first-mover advantage, the future of Haier's global challenges will become a showdown with Korean household appliances giant.
Conveying 'Ammunition' for expansion
Investors all understand the truth: Net cash flow from investing activities is negative, indicating that companies are spending money to expand.
China National Grid noted that in the three stages of Qingdao Haier's 2015, 2016, and January-September of 2017, the net cash flows from investment activities were -102.73 billion yuan, -395.96 billion yuan, -4.808 billion yuan.
In fact, in 2017 Qingdao Haier plans to ease the thirst for funds through public issuance of convertible corporate bonds. In the feasibility analysis report on the use of funds raised from public offering of convertible corporate bonds announced in September last year, Qingdao Haier proposed that The funds raised will not exceed 5.64 billion yuan (including 5.64 billion yuan). They will be used for smart manufacturing upgrades in ice and air production lines, and will be expanded in Casa Di's channels. The layout of smart kitchen power production and marketing network construction will be completed. The 'Belt and Road' overseas emerging markets Manufacturing base construction, advanced R&D laboratories and COSMOPlat industrial internet platform and U+ smart living platform construction, repaying interest-bearing liabilities in five directions.
In April of this year, Qingdao Haier received the “Feedback Opinion” from the China Securities Regulatory Commission. Qingdao Haier mentioned in a subsequent reply that the company’s asset-liability ratio was higher than the industry average for listed companies in the same industry in the country. In addition, the company’s liquidity Ratio, quick ratio is lower than the industry average.
According to the consolidated statement of September 30, 2017, the asset-liability ratio of Qingdao Haier was 69.54%, the current ratio was 1.08, and the quick ratio was 0.86; the value of Midea Group during the same period was 66.86%, 1.42, 1.21; Gree Electric Appliance's value over the same period was 72.93% , 1.09, 1.01.
'The company has developed rapidly in recent years and through debt financing in 2016, it has purchased its home appliance business-related assets from GE in cash. The level of financial leverage utilization is high. At the same time, with the expansion of corporate debt financing scale, in 2016, Since interest expenses have increased significantly, it has affected the company's operating profit to a certain extent. 'Qingdao Haier said in its response.
China National Grid learned that in May 2016, HaierUS Appliance Solutions, Inc. and China Development Bank Co., Ltd. signed a "US$3.3 billion long-term loan agreement". According to the agreement, CDB will provide an equivalent to HaierUS Appliances Solutions, Inc. A long-term loan of 60% or $3.3 billion in the actual delivery amount of the purchased assets.
From this point of view, although the listing of D shares is of great significance to Qingdao Haier's deepening of the global layout, from a direct perspective, the fund-raising on the D shares will help expand offshore financing channels and provide 'ammoment' for its investment expansion.
It is reported that, including Haier, recently three Chinese companies have landed in China Europe. Each company will raise 500 million to 1 billion euros. According to sources quoted by Reuters, Haier’s D share issuance is about one billion yuan. EUR.
However, with regard to the issuance of the D share issuance and listing, the plan to raise funds for the use of the D-shares and other plans, Qingdao Haier will conduct a deliberation vote at the first extraordinary general meeting of shareholders in 2018 on April 27.
The relevant person in charge of the Shanghai Stock Exchange stated that the China-Europe International Exchange is an important achievement of the first Sino-German high-level financial dialogue. The Shanghai Stock Exchange will continue to actively support the construction of the China-Europe International Exchange's D-share market, promote international strategies for domestic high-quality companies, and participate in 'Belt and Road' construction to broaden the channel.