The assets bought for 3.4 billion are now sold for 900 million! Who would have thought that the founder of the company once spent 15 million to have dinner with Buffett?

Every editor: He Xiaotao and Hu Ling

The equity that was purchased at the time of 3.4 billion yuan has now been transferred at a price of 900 million yuan. “Thor” Tianshen Entertainment (002354.SZ) has once again sparked controversy.

On the evening of June 14th, Tianshen Entertainment announced that in order to optimize the company’s asset structure and business layout, reduce the company’s operational risks, and improve the company’s future profitability, the company plans to transfer its holdings of Beijing Fantasy Joy Tour at a total consideration of approximately 903 million yuan. Network Technology Co., Ltd. (hereinafter referred to as “Fantasy Yueyou”) 93.5417% equity.

The 93.5417% equity of Fantasy Yueyou was acquired by Tianshen Entertainment in 2016. At that time, it cost about 3.417 billion yuan, which also means that the transfer of the underlying assets was a 2.643% discount.

As soon as the news came out, the netizens of the stock bar had a lot of discussions. Some netizens said that “it was bought for 3.4 billion a few years ago, and now 900 million is sold.” Some netizens said, “The subsidiary has sold 900 million, and the company should have the money to repay its debt.” The latest data shows that as of March 31, the number of A-share shareholders of Tianshen Entertainment was 26,700.

On the 15th, Tianshen Entertainment’s share price rose once, but then turned and fell. As of the close, it fell 1.84% to 3.74 yuan per share.The stock price fell more than 85% from the highest point of 25.85 yuan in 2017, and the current total market is about 6.2 billion yuan.

A company bought for 3.4 billion yuan

Now sold for 900 million yuan

In 2016, Tianshen Entertainment disclosed that it intends to acquire 93.5417% of the equity of Fantasy Yueyou and 96.36% of Herun Media through the issuance of shares and payment of cash. The transaction price of 93.5417% of the equity of Fantasy Yueyou is 3.417 billion yuan and Herun Media is 96.36 yuan. The transaction price of% equity is 742 million yuan.

It is understood that Fantasy Joy Tour is a company whose main business is the overseas distribution of online games and mobile precision advertising. Since its establishment, Fantasy Travel has focused on markets in the Middle East, South America, and Europe. It has achieved remarkable results in the field of overseas game publishing with differentiation as a path. As of June 30, 2016, Fantasy Travel has represented a total of 45 web games. And mobile online games.

For the purpose of the above acquisition, Tianshen Entertainment has also stated that after the completion of this acquisition, the company’s business map will be more complete, and there will be sufficient synergy and support between the business segments. The two major targets of this acquisition can be used simultaneously. The three major sections of listed companies’ online games, advertising media and film and television content will simultaneously carry out multiple reinforcements to create a pan-entertainment industry aggregation platform of “film and television + games + advertising”.

However, things went counterproductive. After the completion of the merger, Fantasy Yueyou repeatedly failed to fulfill its performance promises. Take 2018 as an example.Fantasy Joy Tour achieved net profit of 141 million yuan after deduction of non-profits in 2018, and the difference from the performance promise was 265 million yuan, and the completion rate was 34.7%.

According to Tianshen Entertainment, as a pure overseas game publisher, Fantastical Yueyou has continued to increase in game acquisition costs and promotion expenses in recent years, and its profit margin has been severely squeezed, and its operating performance has continued to decline. It will be even more severe in 2019 and 2020. With continuous losses, it is expected that there will be greater uncertainty in future performance. After this transaction, the company no longer holds the equity of Fantasy Yueyou, and Fantasy Yueyou is no longer included in the scope of the company’s consolidated statements.This transaction is expected to generate revenue of approximately 130 million yuan.

Tianshen Entertainment’s announcement shows that the takeover party this time is Hainan Feichi Trinidad Technology Partnership (Limited Partnership) and Creation Network Limited (HK). Both counterparties were established for less than one year, and their actual controllers are all natural person Li Jiaxuan.

“Thor” came back to life

In February 2010, Tianshen Entertainment was listed on the Shenzhen Stock Exchange. After a major asset reorganization, its main business was changed to e-sports games in 2014. Data traffic is another main business.

What is still fresh in the public’s memory is that in 2015, Zhu Ye, the founder and major shareholder of Tianshen Entertainment, spent US$2.34 million (approximately 15 million yuan) for dinner with Buffett.

As the business continues to expand, Tianshen Entertainment’s revenue also continues to expand.

From 2015 to 2017, Tianshen Entertainment’s operating income reached 941 million, 1.675 billion, and 3.101 billion yuan, respectively, and net profits attributable to the parent reached 362 million, 547 million, and 1.02 billion yuan, respectively.

In 2018, Tianshen Entertainment initiated more than 10 mergers and acquisitions, with a purchase amount of nearly 10 billion yuan. However, the return of expansion has not yet appeared, and Tianshen Entertainment has ushered in a loss of nearly 8.3 billion for two consecutive years.

From 2018 to 2019, Tianshen Entertainment’s revenue was 2.599 billion yuan and 1.335 billion yuan; the net profit attributable to shareholders of listed companies was -7151 billion yuan and 1.198 billion yuan. Tianshen Entertainment was once called “Thunder God” by shareholders.

Regarding the loss, Tianshen Entertainment explained that due to the excessive expansion of the previous period, the resulting debt scale has increased sharply. In 2018, affected by regulatory policy adjustments such as the freezing of the game industry’s version number, total volume control, etc., as well as the regulation of taxation in the film and television industry, restrictions on specific themes, and governance of artist salaries, the company’s operating performance fell sharply, causing a chain reaction and falling into serious debt Crisis and business crisis.

In August 2019, Tianshen Entertainment received an investigation by the China Securities Regulatory Commission, and together with Zhu Ye received a warning letter from the Dalian Securities Regulatory Bureau. The warning letter revealed the problems of Tianshen Entertainment and Zhu Ye in terms of capital occupation, related transactions, and letter disclosure.

In August of the same year, Tianshen Entertainment began to save the crisis. From the previous announcements issued by Tianshen Entertainment, it can be seen that the change first occurred internally. Chairman Yang Kai resigned and introduced a new management.

Then comes debt restructuring. April 2020*ST Tianyu submitted a reorganization application, and on December 9th of the same year, the reorganization was completed.

On the evening of May 21, 2021, Tianshen Entertainment announced that the stocks will withdraw the delisting risk warning from May 25, 2021 (Tuesday), and the stock abbreviation will be changed from “*ST Tianyu” to “Tianshen Entertainment”; the stock code is not Change, still “002354”.

The announcement also showed that in 2020, Dahua Certified Public Accountants (special general partnership) issued a standard unqualified audit report for the company. After auditing,The company’s operating income in 2020 is 996 million yuan, and the net profit attributable to shareholders of listed companies is 153 million yuan.The net assets attributable to shareholders of listed companies are 2.78 billion yuan.

(The content of this article is for reference only, not as an investment basis. Investors operate accordingly at their own risk.)

Edit| He Xiaotao Du Hengfeng Hu Ling Wang Jiaqi

Proofreading| Lu Xiangyong

The cover picture is self-photographed, and the picture and text are irrelevant

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