Realway Capital (01835.HK) announced on December 3rd that the board of directors recently learned that the company, its subsidiary Shanghai Ruixiang Investment Management Co., Ltd., the company's executive director, chairman of the board, CEO, and the company's controlling shareholder, Mr. Zhu Ping, received a "Notice of Action" and a "Civil Complaint" issued by the People's Court of Shengsi County, Zhejiang Province, as well as related litigation materials (Case No.: (2024) Zhe 0922 Min Chu 343).
According to the "Civil Complaint", the People's Court of Shengsi County, Zhejiang Province, separately accepted bankruptcy liquidation cases of Shengsi Pengbo Real Estate Development Co., Ltd. (Plaintiff 1) and Zhejiang Anlan Hotel Management Co., Ltd. (Plaintiff 2) in June 2023 and August 2023 respectively. The bankruptcy administrator of the two cases, Zhejiang Liuhe Law Firm, claimed that Plaintiff 1 and Plaintiff 2 did not actually use the RMB 200 million yuan injected before the acceptance of the bankruptcy liquidation cases for the operation of the plaintiffs, constituting capital extraction.
Based on this, the plaintiff requests: (i) Defendant 1 Ruixiang Investment (Defendant 1) to pay RMB 200 million yuan to the plaintiff; (ii) Defendant 2 Company (Defendant 2) and Defendant 3 Mr. Zhu Ping (Defendant 3) jointly assume the obligation of Defendant 1's contribution; and (iii) the litigation costs be borne by Defendant 1, Defendant 2, and Defendant 3.
The Group believes that the plaintiff's lawsuit request lacks factual or legal basis. As the fund manager of Realway Capital Yinxin Excellent Contractual Private Equity Fund, Ruixiang Investment managed and utilized the assets of the Yinxin Fund to invest RMB 201.3 million yuan in the production and operation of Plaintiff 1 since September 2020 in accordance with the fund contract and related investment agreements. This investment was fully withdrawn from Plaintiff 1 in February 2022. Ruixiang Investment and the Yinxin Fund are not actual shareholders of the plaintiff, and there is no situation where Ruixiang Investment and the Yinxin Fund embezzled capital as claimed by the plaintiff.