Bauing Decoration(SZ:002047) Zheng Quan Shi Bao Wang·2025-11-17 09:15Core Viewpoint - The article discusses the strategic asset divestiture by *ST Baoying, which aims to improve its financial health and operational efficiency following a change in control from state-owned to private ownership [1][2][4]. Group 1: Asset Divestiture - *ST Baoying plans to sell its investment property in Shenzhen for 86.8725 million yuan to its controlling shareholder's subsidiary, marking a move to "recover" and "reduce burden" [1][2]. - The transaction is expected to positively impact the company's financial status, with an estimated loss of approximately 42 million yuan after accounting for taxes [1][2]. Group 2: Change in Control - The change in control involves a series of transactions that result in a new private entity, Shitong Niu Investment, becoming the largest shareholder with a 25.74% stake, replacing the state-owned Zhuhai State-owned Assets Supervision and Administration Commission [2][3]. - The total consideration for this acquisition exceeds 1.1 billion yuan, indicating a significant investment scale by the new controlling party [2]. Group 3: Historical Context and Challenges - Since the state-owned Zhuhai government took control in 2018, *ST Baoying has faced continuous annual losses, with net assets turning negative by the end of 2024 and a debt ratio exceeding 100% [3]. - The company's operational difficulties stem from broader industry pressures and specific client-related issues, particularly following the Evergrande debt crisis in 2021 [3]. Group 4: Future Strategy and Transformation - The new controlling party plans to pivot *ST Baoying's business focus from traditional construction to the photonics and silicon-based semiconductor sectors, with a commitment to achieve a net profit of 400 million yuan from these new ventures over the next three years [5][6]. - The transaction structure includes a combination of share transfers and voting rights arrangements, allowing the former state-owned entity to retain some influence while enabling the new shareholders to drive the company's transformation [5][6]. Group 5: Market Implications - This case exemplifies a "shell protection" strategy where state-owned assets are divested to private entities to preserve value and stimulate growth, potentially serving as a replicable model for other distressed companies in the market [4][6].