Meisheng Culture Major Reorganization, Changes, and Acquisitions Mobile Games Service Platform

Meisheng Culture (002699), which has been suspended for more than three months, finally unveiled its veil today. The company announced that it plans to raise 3 billion yuan through fixed increase to invest in the construction of the IP ecosystem and the acquisition of Zhenqu Network. The reporter noticed that the company originally planned to acquire Zhenqu Network through major asset reorganization, but in this acquisition, it became a fixed increase that combines acquisition and investment in IP projects, which is quite rare in the A-share market.

The major restructuring and

fixed increase plan shows that the company plans to add no more than 90 million shares and raise no more than 3.03 billion yuan to invest in the construction of IP cultural ecosystem projects (2.1 billion yuan) and acquire 100% equity of Zhenqu Network (930 million yuan). Zhao Xiaoqiang, the company's actual controller and chairman, promised to subscribe for no less than 1 billion yuan. Fang Xinyu Lehuo and Xinyu Tianyou, the shareholders of Zhenqu Network, the target of this acquisition, promised to subscribe for no less than 85.5 million yuan and 78.2496 million yuan respectively.

The reporter found that the company's original plan to suspend trading was a major asset reorganization. On August 6, the company announced that after careful consideration, it confirmed that the matter under which the suspension was planned was a major asset reorganization and planned to invest in the acquisition target in the near future. The target company belongs to the game interactive entertainment industry, and the estimated transaction amount involved is about 1 billion yuan.

However, on the same day as the announcement of this fixed increase, the company announced the termination of major asset restructuring and planning for non-public offering of shares. The company stated that after careful study by the board of directors, it decided to terminate the planning of major asset reorganization and plans to use non-public offering of shares to raise funds to acquire the equity of the target company; at the same time, it plans to raise funds through non-public offering of shares for IP cultural ecosystem projects.

According to the company's statement, the acquisition target when planning a major asset reorganization should have been Zhenqu Network. If so, it was also the acquisition of Zhenqu Network. Why did it no longer constitute a major asset reorganization in this fixed increase? The reporter noticed that there may be two reasons.

First, the company's original 1 billion yuan acquisition plan may hit the reorganization red line of 50% of the net assets of the latest annual report. In this fixed-increase plan, due to the raised funds of 3.03 billion yuan, the volume of the acquisition of Zhenqu Network has been relatively "reduced", avoiding the reorganization condition of reaching 50% of the net assets of the latest annual report; Second, if the company separately acquires Zhenqu Network, it may lead to a change in the company's controlling shareholder. In this fixed increase, the company's actual controller personally subscribed for 1 billion yuan, consolidating its controlling position.

In addition, the pricing benchmark date for this fixed increase is the first day of the issuance period. Recently, the new refinancing regulations proposed by the China Securities Regulatory Commission propose to encourage listed companies to use the first day of the issuance period as the pricing benchmark date.

2.1 billion yuan invested in the IP cultural ecosystem

The highlight of this fixed increase is the planned investment of 2.1 billion yuan to build the IP cultural ecosystem project. The project includes two information technology platforms: SIP Co-Plastic Platform and Pan-Entertainment Development and Operation Platform, an IP Warehouse, and the Meisheng IP Ecological Industry Base project.

Among them, the SIP co-shaping platform plans to open up three major links of original creation in the IP industry: team recruitment, project cooperation, and funding sources by integrating China's original IP resources and individuals, teams and enterprises who create original IP. The IP warehouse plans to expand IP resources through two aspects: one is the high-quality original IP invested and supported by the company, and the other is the purchase of mature and high-quality IP. The company stated that within 4 years after the raised funds are in place, it plans to invest no less than 100 IPs each year.

The company pointed out that it plans to use this project to enhance the company's initiative in acquiring high-quality IP, and at the same time effectively integrate and expand the monetization channels for high-quality IP. It is estimated that the internal rate of return of the IP cultural ecosystem project is 17.76%, and the investment payback period is 5.76 years.

It should be noted that IP investment has been hot among listed companies recently. Huayi Brothers announced in October that it would purchase Haowan Film and Television with a net asset of only 10 million yuan at a high price of 756 million yuan. It values the IP value behind many stars; and Storm Technology also plans to acquire 600 million yuan in literary IP operating companies.

Another

highlight of this fixed increase in the acquisition of Zhenqu Network by 2 times PB is Zhenqu Network. The company was established in 2011 and is mainly engaged in light game service platform business and mobile advertising precision delivery platform business. Data shows that as of August 31 this year, Zhenqu Network's net assets were 476 million yuan, and its net profit from January to August this year was 12.3859 million yuan.

Judging from the purchase price of Zhenqu Network of 930 million yuan, the company seems to have taken a big advantage. However, the reporter noticed that of Zhenqu Network's net assets of 476 million yuan, up to 397 million yuan was the goodwill generated when it acquired Letu Network. Letu Network is a company engaged in billing access service business and settlement service business for mobile games and application products.

As major shareholders of Zhenqu Network, Xinyu Lohas and Xinyu Tianyou promise that from 2015 to 2018, Zhenqu Network will achieve net profits after deduction of non-profit of no less than 60 million yuan, 78 million yuan, 95 million yuan and 114.5 million yuan respectively.

Editor: vian