On 8 Jul 2008, Xinjiang Huitong (group) Co., Ltd. (000415) received a notice from its controlling shareholder, Shenzhen Chunda Investment Co., Ltd., stating that it was brewing a major asset restructuring scheme with its cooperative partners. Thus, trading in of the company shares was suspended on 9 Jul 2008. Following consultation with relevant government authorities, the planned major asset restructuring was regarded as an innovative merger between listed companies.

In the wake of a four month trading suspension due to the restructuring, Xinjiang Huitong disclosed on 24 Nov 2008 that given the drastic changes in the economic climate, both at home and abroad, all parties agreed to abandon the restructuring scheme. Meanwhile, the company also announced that on 20 Nov 2008, Shenzhen Fuding Guarantee and Investment Co., Ltd., the company's former second largest shareholder, transferred its 30 mln restricted company shares to Shanghai Zhouji (Group) Co., Ltd. Those shares will become tradable on 28 Jun 2009 (a 9.99% stake).

Following the aforesaid transfer, Zhouji Group will become the second largest shareholder of the company and Shenzhen Fuding Guarantee the third largest. There are signs that Zhouji Group plays a certain role in the abandonment of this restructuring scheme.

According to the announcement, the legal representative and effective controller of Zhouji Group is Huang Shannian, who ranked 144th on the list of China's richest business people released recently by the business magazine Forbes. His fortune totals RMB 2.48 bln and is primarily engaged in the real estate and ship manufacturing sectors. The total investment of Zhoushan Golden Bay Shipping Co., Ltd., an affiliate of Zhouji Group, amounts to RMB 5 bln with its ship building orders ranking among the top 50 ship manufacturing enterprises.

Notably, the transfer price is RMB 2.00 per share, compared with RMB 6.88 prior to the trading suspension and Zhouji Group paid the transfer fees with certain equity assets.


Source: China Securities Journal

Date: 24 Nov 2008

CN01/BJ/JL/VW/JW