On the evening of October 28, La Chapelle issued an announcement that the company had recently filed two new lawsuits. So far, the company has been involved in a total of 58 lawsuits, with a total amount of 530 million yuan involved.
In addition, as of now, a total of 144 bank accounts of the company have been frozen, the equity of 17 subsidiaries has been frozen, and 4 real estate properties with a total value of approximately 1.704 billion yuan have been seized.
It only took three years for La Chapelle, the “Chinese version of ZARA”, to go from being a women’s clothing giant with more than 9,000 stores in the past to falling from the altar and being heavily in debt.
High in debt
According to Rasha Bell announced that from September 29 to October 26 this year, the company had 2 new lawsuits involving a total amount of approximately 1.84 million yuan.
The first case is a dispute over the sales contract. On November 1, 2019, the plaintiff Golden Monkey Group Weihai Clothing Co., Ltd. signed a processing contract with Xinjiang Hengding International Supply Chain Technology Co., Ltd. to process branded clothes for it. However, after the plaintiff supplied the goods, Xinjiang Hengding International defaulted on part of the payment, and later transferred all the debt to Xinjiang Tongrong Clothing Co., Ltd. through tripartite negotiation. As of August 2 this year, the plaintiff filed a lawsuit with the Xinshi District People’s Court of Urumqi, requiring Xinjiang Tongrong Clothing to pay a payment of 1.0143 million yuan, interest of 83,500 yuan, attorney fees of 40,000 yuan, and litigation costs.
The second case was a dispute over a rental contract. In November 2015, the plaintiff Galleria Land (Dalian) Co., Ltd. leased a 1,446.16-square-meter shop in Dalian Galleria Plaza to Shanghai La Chapelle Casual Clothing Co., Ltd., and the two parties signed a “Leasing Agreement.” However, Shanghai La Chapelle has been in arrears with contract payments since March 2020. The plaintiff filed a lawsuit with the Dalian Economic and Technological Development Zone People’s Court on September 13 this year, requiring Shanghai La Chapelle to pay approximately 252,300 yuan in contract payments, 30 Ten thousand yuan in liquidated damages for contract termination, 27,000 yuan in attorney fees and litigation costs, etc.
As of now, the company has been involved in a total of 58 unconcluded/unmediated litigation cases, and the amount involved in the pending litigation cases is approximately 530 million yuan. Among them, the largest number were lease contract disputes and bill claim disputes, with 16 and 14 cases respectively. The largest amount involved was a guarantee contract dispute, with the amount involved reaching 311 million yuan.
Up to now, due to the impact of a total of 31 litigation cases involving financial loan disputes, construction contract disputes, etc., the company has 4 Real estate has been seized. As of September 30 this year, the total book value of these seized real estate was approximately 1.701 billion yuan.
In addition, as of October 26 this year, a total of 144 bank accounts of the company and its subsidiaries have been frozen, with a total frozen amount of approximately 126 million yuan. This includes a special account for A-share raised funds of RMB 438,200 and a special account for H-share raised funds of RMB 2,404.59.
Due to the company’s involvement in litigation cases and other impacts, the equity interests of 17 subsidiaries of the company have been frozen , the total execution amount involved in the cases is approximately 673 million yuan.
In this regard, La Chapelle stated in the announcement that matters involving litigation and asset freezing have generally had a certain impact on the company’s capital turnover and operation management. It is not ruled out that other assets of the company may be frozen in the future. situation. And because the company has accumulated a high amount of litigation, it may lead to a decline in the company’s financing capabilities and aggravate the company’s financial stress.
There are frequent changes in senior management, with a net profit loss of 289 million in the first three quarters
In terms of personnel, La Chapelle has had frequent changes in senior management since this year.
In January this year, La Chapelle chairman Duan Xuefeng resigned, and Zhang Ying was elected as the new chairman. It is worth noting that in May last year, Duan Xuefeng was single-handedly elected to take office by Xing Jiaxing, the original actual controller of La Chapelle, but he was dismissed soon after by Xing Jiaxing. In this regard, Xing Jiaxing said in an interview with the media that he originally promoted Duan Xuefeng to the position in the hope that he would improve the company’s management capabilities and coordinate the implementation of investment promotion policies. However, there was no progress in these aspects, and Duan did not want to leave, so he had to be dismissed.
In February this year, Chairman Zhang Ying applied to resign as chairman of the company due to work adjustments, and Wu Jinying took over.
But in May this year, Chairman Wu Jinying submitted his resignation again, along with independent director Huang Siying.
In June this year, Zhang Xin was appointed as the chairman of the fourth board of directors and will also serve as the legal representative of the company. Zhang Xin’s other identity is the deputy general manager of the Equity Investment Department of Wensheng Assets.
It is understood that Wensheng Asset is mainly engaged in the investment management business of financial non-performing assets. Since March this year, Shanghai Qijin and Wensheng Asset, acting in concert, have purchased the corresponding shares of La Chapelle through judicial auctions. According to the latest data from the third quarter report, Wensheng Asset currently directly holds 21.6 million shares of La Chapelle, accounting for 6.49% of the company’s total share capital; Shanghai Qijin holds 85.2 million shares of La Chapelle, accounting for 25.62% of the company’s total share capital.
However, since the previous business of these two companies did not involve the clothing industry, it seems that La Chapelle’s performance has not yet ushered in a “turnaround” since Wensheng Asset “taken ownership” of La Chapelle.
According to the third quarter report released by La Chapelle, the company’s operating income in the first three quarters was 365 million yuan, a decrease of 78.16% year-on-year; the net profit loss attributable to the owners of the parent company was 289 million yuan, a net loss of 289 million yuan compared with the same period last year. Compared with 800 million yuan, the loss narrowed; the basic earnings per share was -0.53 yuan, and the basic earnings per share in the same period last year was -1520.0 yuan.
As of September 30, the total number of shareholders was 12,000, a decrease of 1,140 from the previous period. Among the top ten tradable shareholders, Yu Huihua, Wang Chengbing, and Chang Qing are new tradable shareholders.
In terms of stock price, La Chapelle’s stock price is still at the bottom. As of October 28, it was trading at 2.44 yuan per share, with a total market value of 920 million yuan, compared with 31.42 yuan/on October 16, 2017. The stock’s high point fell by more than 90%.
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