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Japan's first listed company goes bankrupt: China Ruyi group's abacus fails?

via:驱动之家     time:2020/5/19 9:50:45     readed:138

Under the heavy pressure of the epidemic, the number of bankrupt enterprises in Japan is increasing day by day.

As of Friday, more than 150 Japanese enterprises had gone bankrupt due to the outbreak of coronavirus, among which renown became the first listed enterprise to go bankrupt.

On May 15, Japan economic news agency reported that Japan's fashion giant renown gave up operating restructuring with its own strength, and its subsidiary renown Agency (Tokyo) as the creditor, applied to the Tokyo local court for the application of the civil regeneration law on May 15, which has been accepted. This is the first time a Japanese listed company has filed for bankruptcy since January 2019, according to Teikoku databank, a credit research firm.

Next, renown will delist from the Tokyo Stock Exchange on June 16.

Ruyi group acquires renown

In 1902, renown was established in Osaka Prefecture.

After decades of development, RENOWN gradually grew from a textile wholesale enterprise to a clothing empire with more than 3000 stores. Derived from Arnold Palmer、Hiroko Koshino、D

In the early 90s of the last century, before the outbreak of the Japanese asset bubble economy, RENOWN, with its outstanding sales performance, sat firmly in the position of the largest garment operator.

However, with the weak economic environment, shrinking population and insufficient consumption capacity of Japan, the sales performance of renown group has declined year by year, and even the farce of management and major shareholders seizing power has appeared.

This just creates an opportunity for Ruyi group, which is covetously looking for overseas acquisitions.

The predecessor of Shandong Ruyi group is Shandong Jining wool textile factory, which was founded in 1972. After the reform, the state-owned shares have been withdrawn and gradually developed into a large-scale Sino foreign joint venture (32% owned by macdow International Trading Co., Ltd.).

Its main business income in China ranks the 8th in China's textile and clothing industry, Ruyi clothing ranks the top eight in China's clothing industry competitiveness, Ruyi printing and dyeing ranks the top three in China's printing and dyeing industry, Ruyi cotton textile ranks the top ten in China's cotton textile industry.

In 2010, through the introduction of Beijing Hejun consulting management company, Ruyi group contacted and inspected renown company, and finally established the acquisition intention: Ruyi invested about 4 billion yen (US $44 million) to acquire 41% of renown's shares, thus becoming the company's largest shareholder and occupying three seats in its board of directors.

On July 29 of the same year, renown company of Japan held an extraordinary general meeting of shareholders, which approved the proposal of Shandong Ruyi technology group to acquire 41.18% of the company's equity by a high vote, marking that the acquisition officially completed the final legal procedures.

Minoru kitabatake, President of renown, said the alliance will enable the struggling 100 year old Japanese store to enrich its capital, reduce its cost base and expand in overseas markets, especially in the fast-growing Chinese market.

The reasons for the successful acquisition of Ruyi group by the Ministry of Commerce in the collection of 2010 research on the distribution offices in Asian countries are as follows:

1. Ruyi group has advanced manufacturing equipment and perfect supply chain, attaches great importance to innovation in corporate culture, and its software and hardware strength meet the requirements of renown company for partners;

2. Under the situation of Japan's weak economy, the consumer market is shrinking, and renown company's performance is poor. The new young management demands change. They strongly hope to take advantage of China's rapid development and cooperate with Ruyi group to open the Chinese market;

3. Ruyi group seizes the favorable opportunity of renown's cash flow shortage and the company's financial difficulties to complete the acquisition at one stroke.

Ruyi Group

Previously, Chinese textile and garment enterprises were limited by the threshold of R & D, technological innovation, brand marketing, etc., and have been squeezed in the manufacturing link of low profit area (providing cheap labor force) in the international industrial division system, while enterprises in developed countries occupied the upstream of the industrial chain by virtue of R & D design, brand marketing advantages.

Ruyi group originally planned to form industrial chain integration and coordination through acquisition of renown, such as obtaining renown's design and R & D capabilities, brand awareness, etc., so as to improve the ability of enterprises to climb up the value chain.

Unexpectedly, in the past decade, the number of textile enterprises and employment in Japan has declined sharply (previously, the number of foreign media has decreased by 40% ~ 50%). Instead of using Ruyi group's sales network in China to expand market space and accelerate development, renown is losing in the competition for market share with UNIQLO's new brands.

In 2020, under the anti epidemic control policy of Japan, department stores will be completely closed, 70% Sales are dependent on the steep drop in revenue sales at department stores, which fell in March from a year earlier 42.5% , decrease in April 81% , together with the hindered recovery of sales funds of about 5 billion yen from Ruyi group, resulting in the total debt of renown reaching one hundred and thirty-eight point seven nine Billion yen Nine point two Billion yuan), the capital chain is directly broken.

Ten years after the deal was completed, Mr. Qiu Yafu, Ruyi's chairman, said:

Now, Ruyi group has not made progress in learning from renown. Shandong Ruyi, short of funds, has been sued for many times this year.

In previous reports of interface news, Bally, a Swiss luxury brand, said in early March that Shandong Ruyi failed to pay $600 million in acquisition fees to jab holdings, Bally's parent company, on time; in April, Bagir, an Israeli men's clothing group acquired by Shandong Ruyi, also proposed that Shandong Ruyi failed to pay the acquisition fees on time, which resulted in the acquisition transaction not being completed on time.

In addition, British footballer David in late April

The reporter of China Times also found in a recently disclosed legal document that Ruyi series companies are facing wage arrears, capital turnover difficulties and even semi production suspension.

Recently, Ruyi group released its financial report for the first quarter of 2020, which showed that the company's operating revenue was 159 million yuan, a decrease of 40.03% compared with the same period last year, and the net profit attributable to shareholders of listed companies was 7.81 million yuan, a decrease of 22.78% compared with the same period last year. If the non recurring profit and loss were deducted, its net profit would be 10.27 million yuan, a decrease of 237.67% compared with the same period last year.

Prior to this, Ruyi Group's 2019 full-year performance is also not optimistic.

The financial report of Ruyi group in 2019 shows that the company's operating revenue in 2019 is 1.15 billion yuan, down 13.39% year-on-year, and the net profit attributable to shareholders of listed companies is 48.16 million yuan, down 51.35% year-on-year. After deducting non recurring profit and loss, its net profit is only 16.28 million yuan, down 66.43% year-on-year.


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