On June 8th, Caijing.com (Reporter Wu Chao) reported that more than a month ago, ST Dimar (600565.SH) was labeled due to three consecutive years of losses and a paragraph in the financial report that carried an "unreserved opinion related to significant uncertainties associated with continued operations", and the stock price has been below RMB 1 and is on the brink of delisting. The company announced last night that it has reached a strategic cooperation intention with Chongqing Development Investment Co., Ltd. ("Chongqing Fa Tou"), but due to the lack of clear specific cooperation matters and legal binding force, the company received an inquiry letter from the Shanghai Stock Exchange that evening.

Caijing.com reporters noticed that this is the third time in nearly a month that ST Dimar has cooperated with state-owned enterprises, showing the company's efforts to "protect the shell and prolong the life."

It is disclosed that Chongqing Fa Tou is a state-owned enterprise wholly owned by the Chongqing State-owned Assets Supervision and Administration Commission, established in 2018, with a registered capital of RMB 20 billion.

ST Dimar said that Baoan Group under Chongqing Fa Tou and Dimar Industrial under the company have maintained a friendly and cooperative relationship for many years with great synergy, complementarity, and agreement in industrial planning, regional layout, strategic direction, and other aspects. Through strategic cooperation, it is conducive to the two parties to achieve resource sharing and integration, complementary development strategies, and jointly promote the long-term stable development of both parties.

However, the strategic cooperation agreement signed this time does not involve specific amounts. After the specific content and details are clarified, the formal cooperation agreement shall prevail, and the corresponding decision-making procedures and information disclosure obligations shall be fulfilled according to the cooperation amount.

In addition, this agreement is an intention agreement signed by both parties for strategic cooperation, without mandatory legal binding force, only indicating the willingness to cooperate in a friendly manner, and does not constitute a legal obligation or commitment that binds the two parties and does not constitute a basis for the two parties to pursue breach of contract responsibilities against each other.

Due to the lack of clear cooperation matters and legal binding force of the cooperation matters, the company received two consecutive inquiries from the Shanghai Stock Exchange to ST Dimar.

The Shanghai Stock Exchange stated in the inquiry letter that as of now, the company's stock has closed below RMB 1 for 11 consecutive trading days, and there is a significant risk of termination of listing. The announcement shows that before substantial cooperation is carried out, Chongqing Fa Tou needs to complete the relevant due diligence, review and approval of specific cooperation matters, and all internal decision-making processes. The company is requested to fully alert investors to the actual impact and uncertainty of the current business situation of the company in light of the signing of the strategic cooperation agreement.

In addition, the Shanghai Stock Exchange pointed out that in the previous period, the company and the controlling shareholder had issued framework agreement matters. The company replied twice to the inquiry letter stating that the relevant agreements have no mandatory legal binding force. The company is requested to explain the progress of the implementation of the relevant agreements up to now, whether there are risks of underperformance or inability to perform, and conduct a self-examination of whether there is manipulation of the company's stock price using non-binding framework agreements.

Caijing.com reporters have noticed that on May 7th, ST Dimar stated that the controlling shareholder, Chongqing Dongyin Holding Group Co., Ltd. ("Dongyin Holding"), and Chongqing Jiangnan Urban Construction Development (Group) Co., Ltd. ("Jiangnan Group") signed a "strategic investment framework agreement," with Jiangnan Group intending to participate as a strategic investor in the judicial reorganization of Dongyin Holding.

In addition, on May 13th, ST Dimar announced that it had signed a "business cooperation framework agreement" with China Resources Yu Kang Asset Management Co., Ltd. ("CRC Yu Kang"), and the two parties plan to carry out business cooperation in reviving troubled projects.

Both of these strategic cooperation news stimulated the market briefly, and on the second day after the news was released, the ST Dimar stock price hit the daily limit up.

Like Jiangnan Group and CRC Yu Kang, Chongqing Fa Tou, who cooperates with ST Dimar this time, is also a state-owned enterprise. In addition, these three cooperation agreements are all intention agreements and do not have mandatory legal binding force.

In recent years, ST Dimar's performance has been poor, achieving operating revenue of RMB 5.196 billion in the first quarter of 2024, a year-on-year increase of 16.21%, but a net loss of RMB 143 million attributable to shareholders of the listed company. The stock has been implementing other risk warnings since May 6th, and the stock abbreviation has changed to "ST Dimar".

As of June 7th, ST Dimar's closing price was RMB 0.82/share, and the stock has closed below RMB 1 for 11 consecutive trading days. According to the regulations of the Shanghai Stock Exchange, if the stock's closing price remains below RMB 1 for 20 consecutive trading days, the company's stock will be terminated from listing.