Core Viewpoint - The cash acquisition by Dike Co., Ltd. raises questions about why the actual controller is voluntarily providing performance guarantees, especially given the company's significant short-term debt pressure and high accounts receivable [1][2][3] Acquisition Details - Dike Co., Ltd. plans to acquire 60% of Zhejiang Suot Material Technology Co., Ltd. for a cash consideration of 696 million yuan, making it a controlling subsidiary [1] - The acquisition targets include Anji Bacuai Equity Investment Fund, Wuxi Zhuyu Equity Investment Fund, and Xinyi Huijin New Energy Venture Capital [1] Performance Guarantee - The actual controller, Shi Weili, who does not hold shares in the target company, has committed to a performance compensation agreement, ensuring that if the net profit of Zhejiang Suot is below 287 million yuan from 2025 to 2027, he will compensate the difference [2][3] Historical Context - Zhejiang Suot previously sought to merge with Dike Co., Ltd. four years ago, but the plan failed due to market changes and regulatory issues [3][4] Financial Implications - The acquisition is expected to increase cash pressure on Dike Co., Ltd., as the cash payment of nearly 700 million yuan comes at a time when the company has significant short-term borrowings exceeding 2.6 billion yuan [9][11] - The company's cash ratio has been declining, with recent figures at 1.28, 0.57, and 0.5 [9] Revenue and Profitability - In 2024, Dike Co., Ltd. reported a revenue of 15.35 billion yuan, a year-on-year increase of 59.85%, but the net profit decreased by 6.66% to 360 million yuan [11] - The company faces substantial accounts receivable pressures, with nearly 4 billion yuan outstanding [11] Related Transactions - There has been a significant increase in related party transactions, with the total amount reaching 2.15 billion yuan in 2024, a 363% increase from 2023 [13] - The revenue and net profit of Zhejiang Suot have also shown a dramatic turnaround, with revenues increasing from 1.26 billion yuan in 2023 to 3.55 billion yuan in 2024 [13]