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after one year and eight months of waiting, news came that the restructuring had failed.

on september 20, investors expressed their "dissatisfaction" by asking questions at the briefing on the termination of major asset restructuring held by luchang technology:

are the shareholders of luchang technology going to sell off their holdings?

doesn't luchang technology's management protect the stock price at all?

when choosing a brokerage firm, everyone would choose sanzhong yihua wisely. why would they fall into the trap when choosing an accounting firm?

is the main reason for terminating the issuance of shares to purchase zoomlion high-tech machinery due to policy reasons or market environment reasons?

will you consider splitting and listing in other markets in the future?

in the face of declining performance and revenue, what follow-up measures will be taken to meet future goals?

direct trigger: accounting firm fined

on january 16, 2023, luchang technology announced the "announcement on the suspension of trading for planning major asset restructuring", stating that the company is planning to issue shares to purchase 100% of the equity of hunan zoomlion intelligent aerial work machinery co., ltd. (zoomlion aerial work machinery) held by all shareholders and raise matching funds.

on february 3, 2023, the company reviewed and approved the "proposal on the issuance of shares by shenzhen luchang technology co., ltd. to purchase assets and raise supporting funds and related transactions". on the same day, the company and the parties involved in the transaction signed the "agreement on issuing shares to purchase assets" with conditional effectiveness.

on september 20 of that year, luchang technology received the first inquiry letter from the shenzhen stock exchange's review center, asking about relevant review issues. half a year later, luchang technology received the second inquiry letter from the shenzhen stock exchange's review center.

on august 27, 2024, luchang technology received a notice from the shenzhen stock exchange that the securities service agency of this transaction, baker tilly international certified public accountants llp, had its business activities restricted by the china securities regulatory commission in accordance with the law, and was given a six-month penalty by the stock exchange for not accepting its securities business and securities service business-related documents. according to article 51 of the "shenzhen stock exchange listed company major asset restructuring review rules", the shenzhen stock exchange suspended the review of this transaction.

subsequently, on september 13, luchang technology held a board meeting to review and approve relevant proposals including "proposal to terminate the issuance of shares to purchase assets and raise supporting funds and related transactions and withdraw the application documents" and "proposal to authorize the company's board of directors to handle matters related to the termination of this reorganization", and decided to terminate the issuance of shares to purchase assets and raise supporting funds and related transactions and withdraw the application documents.

the company stated that since the launch of this reorganization, the company and relevant parties have actively promoted various tasks of this reorganization and fulfilled the obligations of information confidentiality and disclosure in accordance with relevant regulations. on september 19, 2024, luchang technology passed the review of the board of directors and the board of supervisors. in view of the fact that the market environment has changed significantly since the planning of this reorganization, in order to effectively safeguard the interests of listed companies and investors, after careful study, the company decided to terminate this reorganization and withdraw the relevant application documents for this reorganization from the shenzhen stock exchange.

company executives are "interrogated" by investors

on september 20, luchang technology exchanged views and communicated with investors regarding the company's termination of the issuance of shares to purchase assets and raise supporting funds and related transactions.

participants included zoomlion vice president shen ke, the company's director/general manager jiang fucai, zoomlion high-tech chairman/general manager ren huili, luchang technology's board secretary li liu, and independent financial advisor representative li ziqing.

concerned that the termination of the asset restructuring would cause a sharp drop in the stock price, some investors did not hide their disappointment and expressed dissatisfaction with the company in their questions.

"the annual audit agency for luchang technology is kpmg, and the annual audit for zoomlion is also kpmg. why did you choose tianzhi as the audit agency at that time? was there an internal discussion about the past penalties of the winning firm when selecting the intermediary agency? tianzhi was punished, which led to luchang technology suspending its reorganization for 6 months and eventually canceling its restructuring. they all had a keen eye for choosing securities firms and chose sanzhong yihua, but why did they fall into the trap when choosing an accounting firm? how can we avoid this situation in the future? should we strengthen internal management?" a shareholder who holds shares of both zoomlion and luchang technology raised the above questions.

in its reply, the company's management said that the selection of the intermediary institution for this restructuring was in compliance with the relevant decision-making process for listed companies in accordance with laws and regulations. the company and this restructuring have nothing to do with the administrative penalty imposed on baker tilly international accounting firm (special general partnership). since the planning of this restructuring, the market environment has changed significantly compared to the beginning of the planning of this restructuring. in order to effectively safeguard the interests of listed companies and investors, after careful study, the company decided to terminate this restructuring and withdraw the application documents.

the company did not give a clear answer as to whether zoomlion high-tech will continue to consider listing through spin-off or reorganization in the short term. it only stated that if there are corresponding plans in the future, they will be implemented strictly in accordance with relevant laws and regulations, and the information disclosure obligations will be fulfilled in a timely manner.

the stock price has fallen sharply in recent days. does the company have any measures to boost the stock price? the company replied: "we will continue to pay attention to the trend of the capital market and study corresponding measures. if there is a corresponding plan, it will be implemented in strict accordance with relevant laws and regulations, and the information disclosure obligations will be fulfilled in a timely manner."

after the restructuring is terminated, in the face of declining performance and revenue, what follow-up measures will be taken to meet future goals?

the management of luchang technology said that the two main factors for the company's current losses are the continued growth of investment in automotive electronics technology and product research and development and the increase in business development expenses. although these two investments will put pressure on performance in the short term, they can promote the company's sustainable development in the long run. in the future, it will continue to update, improve and invest in accordance with changes in the market environment and the needs of car factory customers. the company's business also keeps up with the development trend of the automotive industry and vigorously explores the market space of the automotive electronics industry. at present, with the determination and mass production of new car factory projects, the company's automotive electronics business has achieved initial results. in the first half of 2024, the revenue of the automotive electronics business has shown an upward trend, especially the smart cockpit revenue reached 72.6871 million yuan, an increase of 99.28% over the same period in 2023, accounting for more than 70% of the revenue of the automotive electronics business.

when asked about the company's cooperation with car companies, luchang technology stated that the company has not yet established cooperation with xiaomi auto and tesla auto.