There is an "immortal bird" on the A** field, which was once listed in the United States, and later delisted and returned to A-shares, but it has become a "sickle" for cutting leeks. It is ST Zhongan (600654), which has been losing money for six consecutive years and its share price has also gone from a high of 4697 yuan fell to 22 yuan, a drop of 95%.
ST Zhongan's predecessor is China Security Technology *** CSST), it is the first domestic security company listed overseas, listed in the United States in July 2005. Five years later, it chose to delist in the United States, and in 2015 it returned to A-shares through a backdoor transaction of Feilo shares.
At that time, Feilo shares were rated at 28The 5.9 billion yuan ** acquired 100% of the equity of CSST, while CSST's net book assets were only 3700 million yuan, with a premium rate of up to 1116 times. After the completion of the acquisition, Feilo shares were renamed Zhong'an Consumption, and the controlling shareholders and actual controllers also became Zhongheng Huizhi and Tu Guoshen.
After China Security returned to A-shares, the stock price soared, rising 360 in two months94%, up to 46An all-time high of $97. The actual controller, Tu Guoshen, has also become a wealthy man, ranking 145th on the Hurun list in 2015 with a net worth of 16.5 billion yuan.
However, this is just a flash in the pan of China Security, since the end of 2016, it has frequently exploded, and has been investigated by the China Securities Regulatory Commission, the "non-standard" financial report, and the failure of restructuring. After the resumption of trading in May 2017, it fell for 17 consecutive trading days, and the stock price halved twice.
In May 2019, the China Securities Regulatory Commission (CSRC) imposed penalties that exposed the true face of China Security by making false and misleading statements in its backdoor transactions, inflating revenues and profits** and deceiving investors. Moreover, it has not fulfilled its performance commitments, and its non-net profit in 2016 was only half of the promise, and it has continued to lose money since then.
After the backdoor, China Security also acquired more than a dozen companies on a large scale, spending more than 3 billion yuan, causing the goodwill to soar to 183.6 billion yuan. The impairment of goodwill led to consecutive losses in 2017 and 2018. In addition, it faced overdue bonds and debts and fell into a funding crisis.
China Security Consumer Insurance barely turned a profit in 2019, but continued to lose money from 2020 to 2022, and the non-net profit has been negative since 2017. It has been wearing the ST hat since May 2017 and has not taken it off, and it has also triggered a delisting risk warning. It's a miracle that it survived in the a** field in such a state.
It is worth noting that Zhongheng Huizhi, the controlling shareholder of China Security Consumption, should compensate China Security for 176,751,344 shares or 127.6 billion yuan in cash, but because of Zhongheng Huizhi's own debt problems, its shares in China Security have been frozen or executed, so it is very difficult for China Security to get compensation.
Such a **, for investors, can only be a lesson, don't be confused by the surface of the glamour and premium, to see the company's true performance and value, don't become the object of leek.