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Financial Association News September 30th (Reporter Xu Xuecheng) Guangdong Songfa Ceramics (603268.SH), which has failed several times in previous restructurings, once again launched a restructuring plan on the eve of the National Day holiday. The target of the company's restructuring this time is the relevant assets of Hengli Heavy Industry Group Co., Ltd. (hereinafter referred to as Hengli Heavy Industry), a subsidiary of Guangdong Songfa Ceramics' controlling shareholder Hengli Group. Guangdong Songfa Ceramics, which has suffered losses for three consecutive years, urgently needs to inject energy into its performance at this time. Given the large scale of Hengli Heavy Industry, how it will operate this asset restructuring will be quite intriguing.

Tonight's announcement shows that Guangdong Songfa Ceramics plans to sell some or all of its assets and liabilities by means of asset sales, asset swaps, or a combination of one or more, and also intends to purchase a certain amount of equity of Hengli Heavy Industry or a certain amount of equity of a subsidiary of Hengli Heavy Industry through a combination of asset swaps, issuing shares to purchase assets, or a combination of one or more ways, this transaction plans to issue shares to specific investors to raise matching funds.

Hengli Heavy Industry is a subsidiary of Hengli Group. As Hengli Group is also the controlling shareholder of Guangdong Songfa Ceramics, this restructuring may constitute a related party transaction.

Hengli Heavy Industry's main business is shipbuilding. Information on the Hengli Group's official website shows that in July 2022, the Hengli Group 'specially established Hengli Heavy Industry Group', 'focuses on the development of shipbuilding, ocean engineering, engines, precision casting, and other sectors'. Subsequently, Hengli Heavy Industry acquired the original STX (Dalian) assets. The latest public news about Hengli Heavy Industry was on September 26th when the first independently produced engine from the Hengli Heavy Industry Industrial Park was successfully delivered. Several media reports stated that this milestone marked Hengli Heavy Industry 'fully capable of manufacturing ship engines independently', achieving a 'major breakthrough in the field of ship power'.

Before the establishment of Hengli Heavy Industry in October 2018, the Hengli Group became the controlling shareholder of Guangdong Songfa Ceramics by acquiring the shares of Songfa Ceramics' original controlling shareholders Lin Daofan, Lu Qiaoxiu, and their jointly acting person Lin Qiulan. Before Guangdong Songfa Ceramics disclosed this restructuring plan, there were rumors about an independent IPO of Hengli Heavy Industry, but there has been no public response from the parties involved.

Guangdong Songfa Ceramics had previously planned asset restructurings multiple times. In March 2016, the company began planning to purchase related assets of Shanghai Elite Education Training Co., Ltd., but announced its termination in June of the same year. In February 2017, Guangdong Songfa Ceramics once again operated asset restructurings with Guangzhou Chuangxian Science and Education Co., Ltd. and Beijing Jinshangqi Technology Co., Ltd., but announced termination in May 2017. In June 2023, Guangdong Songfa Ceramics also disclosed an intention agreement to purchase at least 51% equity of Anhui Liweineng Power Battery Co., Ltd., but once again 'failed' in October of the same year.

Caixin reporters have consulted multiple investor communities and learned that, in view of the current operation situation of Guangdong Songfa Ceramics, investors have high expectations for the company to inject new assets. Financial data shows that in 2021-2023, Guangdong Songfa Ceramics has experienced losses for three consecutive fiscal years. In the first half of this year, the company's loss amounted to 34.7271 million yuan, and operational cash flow was -21.5581 million yuan.