Jin Rong Shi Bao·2025-12-16 02:31Core Viewpoint - Shandong Chenming Paper Holdings Limited plans to divest all financing leasing business assets to focus on its core pulp and paper production strategy, aiming for high-quality development [1][5]. Group 1: Business Divestiture Details - The company will transfer 100% equity of Shandong Chenming Leasing Co., Ltd., 25% equity of Qingdao Chenming Leasing Co., Ltd., and 25% equity of Shanghai Chenming Leasing Co., Ltd., along with a debt claim of RMB 2.263 billion to Shouguang City Shengjia Investment Co., Ltd. for a total consideration of RMB 3.336 billion [2]. - The transaction includes an equity transfer price of RMB 1.073 billion and a debt transfer price of RMB 2.263 billion, after which the leasing companies will no longer be included in Chenming Paper's consolidated financial statements [2]. Group 2: Financial Performance and Challenges - Chenming Paper has maintained leading economic performance in the industry for over 20 years, but has faced declining demand in the paper market, leading to a cyclical low [3]. - The company reported a net loss of RMB 7.411 billion for the year 2024, attributed to significant price drops in paper products and tightening liquidity due to reduced bank loan availability [4][3]. Group 3: Reasons for Divestiture - The divestiture is driven by substantial losses in the financing leasing business, with the three leasing companies reporting cumulative losses exceeding RMB 4.5 billion in the first three quarters of 2025 [5]. - The company aims to optimize its asset-liability structure and concentrate resources on its core business to enhance profitability and core competitiveness, thereby promoting sustainable high-quality development [5]. Group 4: Strategic Shift - Historically, the company expanded into financial sectors such as futures and financing leasing, but is now strategically refocusing on its core business due to changing industry conditions [6]. - The company previously announced plans to dissolve its financial company, indicating that this move would positively impact its main business development and profitability [6]. Group 5: Future Outlook - Industry insiders believe that shedding these non-core businesses will allow Chenming Paper to operate more efficiently and regain momentum in its primary market [7].