As a model of the reform of state-owned enterprises in Henan Province and the "two hundred actions for the reform of state-owned enterprises", 601717-CN (00564-HK) has made new moves.

On November 9, Henan SASAC holding Company and Henan Machinery and equipment Investment Group Co., Ltd., the controlling shareholder of Zheng Coal Machinery, (hereinafter referred to as "Henan equipment Group"), proposed to transfer 277 million shares of Zheng Coal Machinery by openly recruiting the transferee, accounting for about 16% of Zheng Coal Machinery's total share capital, and the public recruitment period was 30 trading days. If there is only one party to take over this time, then the controlling shareholder and actual controller of Zheng Coal Machinery may change ownership.

Only by meeting the three major requirements can we get the return of "coal".

On November 9, Henan SASAC agreed to openly solicit transferees for the state-owned equity transfer project of Henan equipment Group, the controlling shareholder of the company, according to a notice issued by Zheng.

According to the plan, the transfer price of Henan equipment Group's public transfer of Zheng Coal Machinery shares is not less than 7.07 yuan per share (the same below), a discount of 64% from the closing price of 11.60 yuan on November 9. According to the transfer of 277 million shares, the receiver involves a total capital of not less than 1.959 billion yuan. And the final transfer price, Zheng Coal opportunity will be determined on the basis of comprehensive consideration of the quotation to the transferee. If there is only one company that meets the requirements, it will be decided by both parties through consultation and approved by the competent department.

It is worth noting that the transfer price of no less than 7.07 yuan per share offered by Henan equipment Group is very attractive and reasonable for the recipient. As of September 30, 2020, Zheng's net assets per share is 7.509 yuan, which is obviously higher than the transfer price of 7.07 yuan per share. More importantly, Zheng coal machine also has a good dividend rate. According to Wind data, since its listing, Zheng has made a total of 10 dividends since its listing, with an average annual dividend rate of 23.2%.

Since ancient times, good things have been rare, and for the profit-seeking capital market, good investment targets are even more rare.

According to the plan, the receiver needs to meet three major conditions, namely: 1) basic conditions; 2) help to improve the quality of listed companies, maintain the sustained and healthy development of enterprises; 3) help to promote the economic and social development of Henan Province.

In terms of basic conditionsLike the previous equity mixed enterprise transfer agreements, the counterparty puts forward some basic requirements, such as the receiving party has a certain financial strength and integrity and abiding by the law; the lock-up period of shares is not less than 36 months after taking over, and so on.

In terms of promoting listed companies and maintaining the sustained and healthy development of enterprisesThe program emphasizes that the receiver should have the ability to promote the reform of the system and mechanism of listed companies, improve the corporate governance structure of listed companies, and promote the sustainable development of listed companies. In addition, the receiver needs to be able to introduce capital, market, industry and other strategic resources for listed companies.

In terms of promoting the economic and social development of Henan ProvinceThe receiver also needs to have the resources to promote industrial upgrading or industrial integration in Henan Province, and is willing to contribute to the economic development of Henan Province, and put forward specific and effective measures or programs.

Thus it can be seen that although the transfer price is attractive enough, it is not easy to easily accept Zheng Coal Machinery under its command, and the recipient needs to have strong capital strength and social influence. From this point of view, people who want to meet the "mate selection" criteria of Henan equipment Group can be said to be either rich or expensive, and ordinary people still cannot meet such requirements.

In the past, the mixed reform was "reborn", but where is the mixed reform this time?

The equity "mixed reform", have to remind people of Zheng coal machine in the past restructuring and equity changes, and every time the ownership structure has changed, Zheng coal machine has achieved good performance growth.

It is understood that Zheng Coal Machinery, founded in 1958, is an old state-owned enterprise. In the middle and late 1990s, due to the bad coal situation, Zheng Coal Machinery was on the verge of collapse and bankruptcy, with an asset-liability ratio of more than 117% and employees' wages in arrears for eight months. Since 2000, in order to comply with the macro trend of the improvement of the coal industry, Zheng Coal Machinery began to promote enterprise reform in accordance with the principle of marketization, and took the lead in the attempt of mixed reform among the state-owned enterprises managed by the province. Since then, Zheng coal machine has achieved good results in all stages of mixed reform.

Specifically, since 2000, Zheng Coal Machinery began to carry out three front-line reforms: technology first-line, market first-line, production first-line. In 2002, it began to turn losses into profits, reorganized into a wholly state-owned enterprise and changed its name to "Zheng Coal Machinery". After three restructuring and equity changes in 2002, 2006 and 2008, the company changed from traditional factory to company, from wholly state-owned to state-owned holding, from limited liability company to joint-stock enterprise, until A shares and H shares were publicly listed. Zheng Coal Machinery's ownership structure has achieved a preliminary mixed diversity. It has formed a more scientific and reasonable ownership structure which combines the relative holding of the state, the public shares at home and abroad, and the core backbone of the enterprise.

After many times of mixed reform and the injection of the vitality of private enterprises, Zheng Coal Machinery actively carried out the layout of multi-industry chain to reduce the periodic impact of the industry. Since 2016, Zheng Coal Machinery has taken three years to integrate and establish the auto parts industry plate through mergers and acquisitions, which owns two major brands of SEG Group and Yaxinke Group of Germany, and has realized the industrial transformation from coal machinery plate to auto parts plate, thus forming a two-wheel drive equipment platform of "coal machine + auto parts".

After more than half a century of development, with the help of the trend of mixed reform, Zheng Coal Machinery has gradually grown from an unknown and on the verge of bankruptcy to the world's largest R & D and manufacturing of fully mechanized coal mining hydraulic support and the country's leading manufacturer of auto parts.

From 2016 to the end of 2019, Zheng's revenue increased from 3.629 billion yuan to 25.721 billion yuan, with a compound annual growth rate of 92.1 percent, and net profit increased from 61.997 million yuan to 1.04 billion yuan, with a compound annual growth rate of 155.9 percent. It is worth noting that from the results of the first three quarters of 2020, Zheng Coal Machinery's good business performance is still continuing. As of September 30, 2020, Zheng Coal Machinery's revenue was 19.255 billion yuan, an increase of 1.82% over the same period last year, and the net profit attributable to shareholders was 1.085 billion yuan, an increase of 4.44% over the same period last year.

Admittedly, the mixed reform has enabled Zheng Coal Machinery to achieve Phoenix Nirvana from adversity, growing from the original insolvent to the well-deserved leader of the industry. And now the business boom Zheng coal machine, why to continue to choose equity mixed reform in good times?

For this question, the answer can be found in the past media interviews with Zheng Coal Machinery Chairman Jiao Chengyao. In the article "the New Journey of Zheng Coal Machinery" published in Henan Business Daily on October 24, 2019, Jiao Chengyao, chairman of Zheng Coal Machinery, said, "at present, Zheng Coal Machinery still has many problems and needs to be reformed." for example, the company's ownership structure, corporate governance structure, medium-and long-term incentive mechanism, group management and control system all need to be further optimized. "

The article also pointed out that from the perspective of Zheng's ownership structure, among the top 10 shareholders, except for the state-owned controlling shareholder Henan Machinery and equipment Investment Group Co., Ltd., the other shareholders accounted for 12.73%, 4.34%, 3.11% and less, respectively. The advantage of over-dispersed non-state-owned capital in making major decisions is not obvious. One analyst believes that when a company makes decisions, a shareholder has an absolute say, which is not necessarily a good thing for the enterprise.

In the past, equity reform has indeed brought qualitative changes to Zheng's business activities, but this time through the public recruitment of transferees to carry out equity mixed reform, whether it can promote its continued glory or achieve greater achievements, we can only wait and see.