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Aichi car is involved in illegal fund-raising case

2024-06-25 Update From: AutoBeta NAV: AutoBeta > News >

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AutoBeta(AutoBeta.net)06/03 Report--

A few days ago, the illegal fund-raising case of Shanghai Beigang Investment Management Co., Ltd. (hereinafter referred to as "Beigang Investment") was heard in the first instance of the people's Court of Huangpu District in Shanghai, and more than 30 senior executives were charged with illegally absorbing public deposits. It is reported that some of the funds illegally raised in the case went to two car companies, namely Vientiane Motor and Aichi Automobile, of which 6.3 billion yuan went to Vientiane Automobile and 1.5 billion yuan to Aichi Automobile. The media pointed out that the key figure in the case is Chen Xuanlin, who has been the real controller of Guangwei Holdings since September 2017.

According to the data, Vientiane Automobile, founded in August 1985, is a veteran bus manufacturer, which was acquired by Guang Wei Holdings in August 2017. Chen Xuanlin became a legal person of Vientiane Automobile and changed to Chen Wei in August 2022.

Aichi Automobile, founded in October 2016, is a member of the new power of car building. In January 2022, Aichi welcomed a new round of financing from Chen Xuanlin and his Dongbai Group, with a financing amount of hundreds of millions of dollars. With the financing in place, the management of Aichi Automobile has undergone a "big change". Founder Fu Qiang will no longer serve as legal representative and chairman, and Chen Xuanlin will take over. Under the leadership of Chen Xuanlin, Aichi began to try to solve the problem of financial shortage through backdoor listing. However, Chen Xuanlin announced his "abdication" after less than half a year as chairman, and was replaced by Zhang Yang, a former Aichi director. Chen Xuanlin was soon revealed to have absconded overseas.

In November 2022, Beiguangtou issued an announcement letter showing that "the personal reasons of Chen Xuanlin, the actual controller of Guang Wei Holdings and Aichi Automobile, have caused uncertainty in the operation and management of the financiers, and the principal and interest of some products have not been paid on schedule." According to media reports, Chen Xuanlin and his Dongbai Group planned to increase the capital of Aichi Automobile by 2.5 billion yuan at that time, but the actual financing was only 2.3 billion, most of which was used to repay the suppliers, of which 1.4 billion was the source of funding. direct financing for No. 1-8 of the "Aichi Automobile Direct financing Plan Series" issued by Dongbai Group through Beiguang Investment This may be the 1.5 billion yuan that went to Aichi Motor out of the more than 10 billion yuan not paid at the time of the illegal fund-raising case in Beiguangtou.

The reason why Aiqi is involved in the case of illegal fund-raising is that it costs too much money to build a car. Data show that in 2020 and 2021, Aichi lost 1.597 billion and 1.623 billion respectively. As of December 31, 2021, Aichi had only 54.64 million yuan in cash, but its total debt was as high as 3.359 billion yuan. When Aichi's funds were broken, Chen Xuanlin's appearance did give Aichi a glimmer of life, but Chen Xuanlin's appearance did not alleviate the dilemma of Aichi, and since 2023, Aichi began to fall into production and operation difficulties. Factory shutdowns, arrears of wages and other problems have also been exposed one by one.

Despite the crisis, Aichi seems reluctant to give up. Not long ago, Hudson acquired Company I (Hudson Acquisition l Corp.) Announced that it has signed a business merger agreement with Aiways Automobile Europe GmbH, an European company that will provide electric vehicles for the European market. According to the report, shareholders of Aichi Europe will receive newly issued HUDA common shares with a total amount of about $400m, and the deal will be completed by the end of this year. Previously, in order to avoid fierce competition in the Chinese market, Aichi shifted its focus to overseas markets, setting up electric sports car research and development centers and factories in Germany, as well as overseas divisions and European sales companies in Munich.

The car is waiting for the White Horse Knight again, but now he is involved in an illegal fund-raising case. Chen Xuanlin used to save Aichi cars and water and fire with a huge amount of money, but now he has repeatedly become a hindrance to the backdoor listing of Aichi cars. In any case, I'm afraid the Aichi car can't stand any more trouble.

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