First bullet of the year! Yibai Network will sell 90% of its shares for 1.51 billion

After many twists and turns, Huakai Creative's application for major asset restructuring was finally approved by the Shenzhen Stock Exchange. Huakai Creative will acquire 90% of Yibai Network's equity for 1.51 billion yuan. The first round of capital for the new year with the strong sales of cross-border e-commerce is exciting!

Approved! Yibai Network will sell 90% of its shares for 1.51 billion

Previously, Huakai Creative planned to purchase 90% of the equity of Yibai Network held by Nanping Mangliduo, Luo Ye, Nanjing Chaoran, Yishenghuihuang, Chenhui Langzi, Jizi Maria, Li Xu, Huang Lishan and HSBC Chase No. 1 through a combination of issuing shares and paying cash. The corresponding valuation of the target asset 90% of the equity of Yibai Network is approximately RMB 1.51 billion.

The latest news is that on February 24, the Shenzhen Stock Exchange has reviewed and approved Huakai Creative's application for major asset restructuring.



Huakai Creative also issued an announcement, saying that it had received a notification letter from the Shenzhen Stock Exchange. After review, the Shenzhen Stock Exchange agreed to its application to issue shares and pay cash to purchase assets and raise supporting funds. The company will then need to go through the registration procedures of the China Securities Regulatory Commission. Thanks to this good news, Huakai Creative opened up 5% on February 25.

Huakai Creative's announcement is only half a page long, but those in the know know how many twists and turns it took to get the application approved - it took nearly two years, the review was suspended, and it received multiple inquiry letters. Many people doubted whether the deal could be successful. The twists and turns made people shed tears:

On September 16, 2019, Huakai Creative reviewed and approved the proposal to purchase the equity of Yibai Network and related drafts;
On January 16, 2020, the China Securities Regulatory Commission reviewed the company's merger and reorganization and rejected it;
On March 17, 2020, the company reviewed and approved the "Proposal on Adjusting the Company's Major Asset Restructuring Plan" and other documents;
On July 3, 2020, we received a restructuring inquiry letter from the Shenzhen Stock Exchange;
On October 1, 2020, we received a notice of suspension of review from the Shenzhen Stock Exchange (the financial information had expired);
On October 12, 2020, we received a notice from the Shenzhen Stock Exchange agreeing to resume the review;
On October 26, 2020, we received the “First Round Review Inquiry Letter” from the Shenzhen Stock Exchange;
On December 4, 2020, we received the “Second Round Review Inquiry Letter” from the Shenzhen Stock Exchange;
On December 30, 2020, we received the “Third Round Review Inquiry Letter” from the Shenzhen Stock Exchange;
On January 1, 2021, we received a notice of suspension of review from the Shenzhen Stock Exchange (the transaction valuation base date has exceeded 12 months);
On January 13, 2021, we received a notice from the Shenzhen Stock Exchange agreeing to resume the review;
On February 24, 2021, the Shenzhen Stock Exchange approved it.

Good things come to those who wait. Huakai Creative finally succeeded and added a cross-border e-commerce business segment that is in its bonus period. According to its 2020 annual performance forecast, Huakai Creative's revenue last year was only 130-150 million yuan, and its loss reached 50-65 million yuan. However, Yibai Network's revenue in the first three quarters of last year was as high as 3.03 billion yuan, and its net profit was 260 million yuan, far exceeding Huakai Creative. It can be foreseen that after the completion of this reorganization, Yibai Network will become the profit "engine" of Huakai Creative.

Yibai Network employees were also excited about the acquisition. One person said: "Thank you Yibai. Following the right boss and choosing the right platform is more important than hard work. 2021 is a new journey and a new starting point. We will forge ahead and strive to achieve higher goals!

Compared with big sellers like Aokee , Tongtuo , Youkeshu , etc., is Yibai Network better?

Previously, when Huakai Creative received a new round of inquiry letters from the Shenzhen Stock Exchange , it responded to the key issues of concern to the Shenzhen Stock Exchange.

First, Yibai Network accumulates and mines user data in the following ways: grasp user and order information related to order execution , mainly including buyer ID, email address, consignee name, consignee address and other data of sales orders ; through the intelligent advertising system, statistics and analysis are conducted on the keywords used by users to enter the sales page through on-site search and place orders, as well as their corresponding clicks, number of advertising orders, advertising order amounts and other data ; information on hot-selling products in subdivided categories, popular products on third-party e-commerce platforms , user comments, product ratings, sales volume and other public data obtained through public channels are used to guide product development.

Yibai Network ’s user data is mainly used in three business links: product development , procurement and stocking , and sales promotion .

Perhaps sellers in the industry are interested in the sales promotion link of big sellers, which is directly related to orders.

Yibai Network will classify and manage user search terms based on the collected user search term data and their corresponding click volume , advertising expenditure, number of advertising orders, amount, etc., taking into account factors such as festivals, seasons, hot searches, and hot items:

(1) Targeting the core keywords that describe the product category, placing keyword ads through bidding;

(2) Long-tail keywords that accurately describe products are placed at high prices to grab advertising space because the click-through rate of users searching for such keywords is high.

(3) For general words or inefficient words with low conversion rates, precise negation is performed.

Through classification management, Yibai Network organizes high-quality words into a keyword library, monitors indicators such as promotion cost rate, advertising revenue ratio, CPC unit price, dynamically optimizes the delivery strategy of in-site advertising, and reversely guides the optimization of product titles and copywriting to achieve traffic conversion.

Secondly, Yibai Network is a cross-border e-commerce exporter of general products. The purpose of its information system is mainly to optimize business processes. In terms of intelligent optimization, Yibai Network uses intelligent listing systems , intelligent price adjustment systems , intelligent advertising systems and intelligent stocking planning systems , and has achieved good results in optimizing specific business processes . Big sellers use intelligent systems, which may be beyond the reach of some small and medium-sized sellers.

Finally, industry insiders are generally concerned about the comparative data of Yibai Network 's performance growth rate, profit margin level, inventory turnover rate and other aspects with those of its peers.

Combining the information system's online time, update and iteration process and the situation of comparable companies, the data of Yibai Network and several big-selling companies such as Kuaiditong , Aok , Tongtuo and Youkeshu are quite interesting.

In 2018 and 2019, Yibai Network's revenue was RMB 181,250.44 million and RMB 356,715.35 million, respectively, up 97.88% and 96.81% from the previous year, with a compound growth rate of 97.35%. In terms of revenue growth rate, Yibai Network is higher than the corresponding annual growth rate of the other four pan-category cross-border export e-commerce companies, but in terms of revenue scale, Yibai Network is lower than the above four comparable companies.

Yibai Network's ability to obtain external financing and expand into the blue ocean category market when its revenue scale was relatively low were important factors influencing the rapid improvement in its performance in 2018 and 2019 .

Comparing Yibai Network's gross profit margin levels with those of the four companies in 2018 and 2019 , its annual gross profit margin levels are close to that of Aogee and higher than the average of comparable companies in the same industry .

When developing new products, Yibai Network will make a rough assessment of the expected development profit margin of the product, and formulate different development profit margin standards based on the differences between the sales countries and platform types . New products with expected development profit margins lower than the preset standards will not be developed. In 2018 and 2019 , it was able to maintain a gross profit margin of 60% , which is also quite excellent!

In terms of net profit, there was no significant difference between Yibai Network and the average of comparable companies in 2018 and 2019. It said the main reason was that the gross profit margins and expense rates of various companies differed due to different business models and operating levels .

From January to June 2020 , Yibai Network's revenue growth rate was 29.12%, which was lower than the year-on-year growth rate in the previous two years and lower than the average revenue growth rate of comparable companies in the same period . It said that this was the result of the company's active adjustment of its business strategy and improvement of its business quality .

Specific factors affected include the impact of the "new crown" epidemic in the first half of 2020 , rising cross-border logistics prices, slower delivery times , and goods sent to overseas warehouses unable to be delivered on schedule . The pain points of big sellers are similar to those of small and medium-sized sellers!

In the new year, capital is positive and the cross-border e-commerce industry is booming.

Yibai, equity, cross-border e-commerce