80 Million "Half-Price" Subsidiary Equity Fire Sale Draws Regulatory Inquiry, Yonghui Supermarket Responds

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Image source: Yonghui Supermarket

On the evening of March 16, Yonghui Supermarket (601933.SH) issued a notice in response to the Shanghai Stock Exchange regarding regulatory work on the company’s sale of the remaining equity of Yonghui Yunjin Technology Co., Ltd. (hereinafter referred to as “Yunjin Technology”).

The announcement disclosed that Yonghui Supermarket plans to transfer 28.095% of its stake in Yunjin Technology to its controlling shareholder, Shanghai Paihui Technology Co., Ltd. (hereinafter “Paihui Technology”), for 80 million yuan. The transaction price, significantly below Yunjin Technology’s historical valuation and book value, has raised regulatory concerns about the reasonableness of the deal and whether it damages the interests of the listed company.

Yunjin Technology was established in December 2019 with a capital of 500 million yuan as a wholly owned subsidiary of Yonghui Supermarket, to develop supply chain finance and serve the retail ecosystem. Over the following years, Yonghui Supermarket sold all its shares in three separate transactions.

In June 2024, to implement the strategy of “focusing on core businesses and divesting non-core assets,” Yonghui Supermarket reached an agreement with Paihui Technology to sell 65% of Yunjin Technology’s controlling stake for 378 million yuan, valuing the entire company at approximately 581 million yuan.

In September 2025, Yonghui Supermarket sold an additional 6.905% stake in Yunjin Technology to Paihui Technology for 41.45 million yuan. This sale was part of the company’s ongoing exit from financial-related businesses and efforts to activate assets.

In January of this year, to fully exit financial-related businesses and accelerate asset liquidation and capital recovery, Yonghui Supermarket planned to transfer its remaining 28.095% stake in Yunjin Technology to Paihui Technology for 80 million yuan. This price was roughly half of the previous valuation.

On December 30, 2025, Yonghui Supermarket first listed its 28.095% stake in Yunjin Technology on the Chongqing United Property Rights Exchange, with a starting price of 177 million yuan. Due to a lack of interested buyers, Yonghui Supermarket reduced the price twice, to 153 million yuan and then to 120 million yuan, but still failed to sell. To prevent the asset disposal process from stalling, Yonghui Supermarket negotiated based on market feedback at the 120 million yuan starting price with Paihui Technology. After negotiations, the final transaction price was set at 80 million yuan.

In response to inquiries about the reasonableness and fairness of selling the remaining stake at a price significantly below book value and historical valuation, and whether it harms the interests of the company, Yonghui Supermarket stated that its initial investment in Yunjin Technology was 500 million yuan. Before the June 2024 sale of the controlling stake, the company, as the controlling shareholder, made necessary resource investments. Since Paihui Technology became the controlling shareholder, Yunjin Technology’s daily operations and capital expenditures have been led by Paihui Technology, with the company only as a shareholder without further major investments.

According to them, Yunjin Technology’s performance declined sharply after the initial transfer of control, which is a key reason for its valuation discount. Its net profit dropped from 92.23 million yuan in 2023 to 38.60 million yuan in 2024, and further to 16.99 million yuan in 2025, a cumulative decline of over 80% in two years.

Yonghui Supermarket explained that the performance decline of Yunjin Technology mainly results from stricter regulation of the financial industry, a slowdown in the expansion of its original business, and the company’s strategic and risk management considerations, leading to a deliberate contraction of corporate and consumer finance activities and a direct reduction in operating income.

Additionally, in June 2024, when Yonghui Supermarket first sold its controlling stake in Yunjin Technology, the company was at its performance peak, and the controlling stake had a strategic synergy premium, with an overall valuation of 581 million yuan. However, at the time of selling the remaining minority stake, Yunjin Technology’s annualized net profit was only 18.4% of that at the initial transaction. Under this context, the valuation levels given by the market (through public listing without an explicit bid) and the transaction counterparties have been adjusted downward, which aligns with internal business logic.

Yonghui Supermarket stated that, given the failure to find interested buyers on the open market and the ongoing risk of asset impairment, continuing to hold this stake would tie up company funds and increase risk exposure. The current transaction allows the company to divest from financial assets, quickly recover 80 million yuan in cash, and reinvest those funds into core retail operations, improving capital efficiency. This approach is fundamentally in the overall interests of the listed company and all shareholders.

In recent years, Yonghui Supermarket’s performance has been under pressure. On January 20, Yonghui Supermarket announced that it expects a net loss attributable to shareholders of 2.14 billion yuan for 2025, compared to a loss of 1.47 billion yuan in the same period last year. This indicates that the company has experienced five consecutive years of annual net losses since 2021.