The latest: Supply chain financing solutions provider Linklogis Inc. (9959.HK) announced on Wednesday that it sold its 19.6% stake in Sinopharm Rosina (Shanghai) Commercial Factoring to Sinopharm Holdings (China) Financial Leasing for 112 million yuan ($15.6 million).
Looking up: The disposal of this non-core asset will provide money for the company to invest in its future business development.
Take Note: Linklogis will incur a loss of approximately 13.08 million yuan on the transaction, but its board believes the price is the maximum it can obtain in the current climate and for the reasonably foreseeable future.
Digging Deeper: Founded in 2016, Linklogis has become a leading supplier of supply chain financing technology and listed on the Hong Kong Stock Exchange in April 2021. It helps other companies automate their supply chain financing processes, often using large enterprises’ credit to enable their suppliers to get low-cost financing by providing their accounts receivables at a discount to lenders. Its first-half revenue declined by 23.4%, dragging the company into the red with an adjusted loss of more than 86 million yuan for the period, as demand for its key products declined due to difficulties experienced by its major customers caused by the slump in China’s real estate market.
Market Reaction: Linklogis shares fell on Thursday to close down 0.6% at HK$1.73 by the midday break. It now trades at the lower end of its 52-week range.
Translation by A. Au
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