When facing thousands of listed company announcements every day, which ones should you read? What are the key points to take away from the dozens or hundreds of pages of material announcements? Are the many professional terms in the announcements bullish or bearish? Check out Caixin's "Quick Read Announcement" column, where our reporters across the country will provide you with accurate, fast and professional interpretations on the night of the announcement.

On December 9, Financial Alliance reported (by journalist Wu Chao) that after previously planning to transfer control but unsuccessful, the founder Huang Yehua and his family of Xuancheng Valin Precision Technology (603356.SH) have finally found a "new owner" for the company. Financial Alliance journalists noticed that the planned new actual controller Zheng Jianbo had previously founded the internet company Giant Network Technology, which was acquired by Sunwave Communications (002115.SZ) at a premium; currently, Giant Network Technology is also engaged in short drama and AI and other "popular" businesses. Whether Xuancheng Valin Precision Technology can have a better future under the leadership of the new actual controller has become a focus of investor attention.

Xuancheng Valin Precision Technology announced tonight that on December 6, it signed a "Share Subscription Agreement" with Shangrao Juzhun Qiming Enterprise Management Partnership (hereinafter referred to as "Shangrao Juzhun"). The company plans to issue no more than 40 million shares to Shangrao Juzhun at an issue price of 11.33 yuan per share, which has a certain discount compared to Xuancheng Valin Precision Technology’s closing price of 14.68 yuan per share before the suspension. It is expected that the total funds raised by the private placement will not exceed 0.453 billion yuan.

Upon completion of the issuance, Shangrao Juzhun will replace Huang Yehua as the controlling shareholder of Xuancheng Valin Precision Technology, and Zheng Jianbo will replace the Huang Yehua family as the actual controller.

Regarding the purpose of this private placement, Xuancheng Valin Precision Technology stated that in recent years, facing a downward economy, a sluggish downstream market for the elevator parts industry, rising csi commodity equity index prices, and intensified competition in the industry, the company’s operations are under pressure. Additionally, from 2021 to the first three quarters of 2024, affected by the downturn in the real estate industry and rising raw material prices, the company increased bank loans to alleviate operational cash flow pressure, and the increase in interest-bearing liabilities led to an increase in the company’s financial costs, thus reducing the company’s profitability.

Xuancheng Valin Precision Technology believes that the funds raised by this private placement will be used to supplement working capital and repay bank loans. The arrival and utilization of the raised funds will effectively optimize the company’s financing structure, alleviate operational cash pressure, and at the same time provide important financial support for the company’s strategic development.

Regarding the "new owner" of Xuancheng Valin Precision Technology, Financial Alliance journalists noticed that Zheng Jianbo’s main identity is the founder of Jiangxi Giant Network Technology Co., Ltd. (referred to as "Giant Network Technology"), where he has long served as chairman and general manager. Giant Network Technology mainly engages in precise internet advertising placement, was listed on the national equities exchange and quotations, and was delisted in 2017. That year, Sunwave Communications acquired Giant Network Technology for 1.35 billion yuan through issuing shares and cash payment. At that time, the net asset book value of Giant Network Technology was 0.128 billion yuan, so the estimated appreciation rate exceeded nine times. Zheng Jianbo also obtained equity in Sunwave Communications and has previously served as a director.

However, this astonishing acquisition with a high premium has caused serious losses for sunwave communications. In 2021, due to giant network technology not fulfilling its performance commitments, sunwave communications recognized an impairment of goodwill of 0.801 billion yuan.

During this period, Zheng Jianbo also had disputes with sunwave communications. The 2020 annual report of sunwave communications prominently featured a dissenting statement from director Zheng Jianbo, stating, "In the 2020 annual report, the description that 'in 2020, due to the rapid changes in mainstream media platforms, the monetization ability of self-media (such as WeChat public accounts) has declined' is considered inconsistent with the facts. This director believes it should be clarified to investors that the decline in performance is primarily due to the impact of pandemic-related force majeure."

Thereafter, Zheng Jianbo also requested to terminate the "Performance Reward and Compensation Agreement" with sunwave communications. According to the announcement at that time, Zheng Jianbo believed that sunwave communications appointed a new general manager for giant network technology against Zheng Jianbo's opposition, undermining the stability and good "chemical reaction" of the original core team, hence the current general manager of giant network technology needed to be held accountable for the 2020 performance.

The incident attracted the attention and intervention of the Zhejiang Securities Regulatory Bureau, and ultimately both parties signed a supplementary agreement, under which Zheng Jianbo provided a certain performance compensation to the company as per the new agreement.

Currently, giant network technology has expanded more businesses in the "windfall" sector. On December 2 of this year, sunwave communications stated on the interactive platform that its subsidiary giant network technology has a professional short drama operation team that can rapidly respond to client needs, providing refined project solutions for clients in the short drama industry. Furthermore, public information also shows that giant network technology continues to enhance its technology investment in the AI field, launching the Lingxi platform and Lingxi AI assistant, and achieving batch production of creative materials such as videos and images with several applications of AIGC new technology.