Leju Finance Deng Rufei Shulan Medical Management Co., Ltd. (hereinafter referred to as “Shulan Healthcare”) submitted a listing to the Hong Kong Stock Exchange in August. The co-sponsors are CICC and CITIC Securities.
While Shulan Medical continues to introduce strategic investors, there are also many shareholders who have chosen to reduce their holdings or withdraw, yet in the process of transferring shares during the same period, prices varied.
From March to July 2017, the company's shareholders, Mingshang Investment, reduced their holdings and cashed out their holdings of 400,000 yuan, 333,300 yuan of registered capital, and 133,300 yuan of registered capital of Shulan Medical to Health Care Investment, Taoying Investment, and Talent Fund respectively. The share transfer price was 150 yuan/registered capital, and Mingshang Investment cashed out a total of 130 million yuan.
Meanwhile, natural person shareholder Ge Feiyu transferred his registered capital of 171,500 yuan to Dexin Investment at the same price. The transfer price was 165 yuan/registered capital, and 50 million yuan was cashed out.
In November 2018, Taoying Investment transferred Shulan Medical's registered capital of 1,555,200 yuan to Yuya Investment at a cost of 50 million yuan. The transfer price was only 32.15 yuan/registered capital, which is only about 20% of the share transfer price a year ago.
According to the prospectus, Taoying Investment is a limited partnership. Zhejiang Haigao Asset Management Co., Ltd. is its general partner and holds 0.05% of the shares. The remaining partnership interests are held by 3 limited partners. Yuya Investment is also a limited partnership. Its general partner is also Zhejiang Haigao Asset Management Co., Ltd., which holds 0.02% of the shares. The remaining partnership interests are held by 16 limited partners.
The low price transfer mentioned above can be viewed as an internal move; it is no coincidence. In May 2019, Lu Zhen, a natural person shareholder, transferred the registered capital of Shulan Medical of 6.9984 million yuan to invest in Ju Network at a price of 3.57 yuan/registered capital. The latter was invested by Shi Youyun, Lu Zhen, and his son Lu Runbang.
Before and after Shulan Medical carried out Series C financing, a large number of shareholders also reduced their holdings and cashed out.
In April 2020, Tianjin New Vision withdrew from the ranks of shareholders of Shulan Medical. It transferred all of its shares to Cliff Investment, Qiming Rongxin, and Dexin Investment at a price of 37.66 yuan/registered capital, and cashed out 603 million yuan, with a return on investment of 424.56% over four years.
In August of the same year, Ningbo Haijun transferred part of its shares to China Life Insurance Health Fund, Sequoia Hanchen, and Cheng Huamin, and cashed out a total of 216 million yuan. The average share transfer price was 51.12 yuan/registered capital, up 35.74% from four months ago.
Ningbo Haijun is a shareholding platform for Shulan Medical executives. The company's chairman and general manager Zheng Jie, vice president Du Jianping, non-executive director Xu Dilong, deputy general manager Xu Meifang, external investor Li Tanwei, and Zheng Jie's younger brother Zheng Jun hold 34.02%, 20.83%, 17.35%, 17.35%, 10.41%, and 0.03% of shares respectively.
In the same month, Juwang Investment, Yuya Investment, and Healthcare Investment reduced their holdings by 173 million yuan, 83.3464 million yuan, and 336.83.31 million yuan respectively at the same price.
Meanwhile, Shulan Investment transferred its registered capital of 503,900 yuan to Shanghai Renan at an ultra-low price. The transfer price was only 0.2 yuan/registered capital. According to the prospectus, Shanghai Renan is a wholly-owned subsidiary of Shihua Investment Co., Ltd. The latter is a limited company incorporated in Hong Kong. It is ultimately wholly owned by individual investor Lee Kai You, Mr. Anthony (“Mr. Lee”), and Mr. Lee is an independent third party.
Prior to submission of the statement, Shulan Medical had a total of 31 shareholders. Among them, Zheng Jie, Zheng Jun, and Shulan Investment were a group of controlling shareholders. Shulan Investment, which was jointly owned by brothers Zheng Jie and Zheng Jun, held 46.91% of the company's shares and was the largest shareholder; the two held 28.62% and 19.24% of the company's shares through direct and indirect methods, respectively.
In addition, Singapore GIC is the external investment institution with the highest shareholding ratio, holding 13.93% of the company's shares; China Life Insurance holds 4.75% of the shares through China Life Insurance Health Fund; Yida Fund holds 2.87% and 0.53% of shares respectively through Jiangsu Yida and Talent Fund; 2.21% of Qiming Rongxin's shares; and Sequoia Hanchen holds 2.19% of the shares.