Shenxun secures $24M loan to fund Zhongke Ruizhe acquisition
What's the deal? ShenxunDealroom has a profile for this one. Try Dealroom → has signed a merger-and-acquisition loan contract worth US$24.1M with China Construction Bank's Hunan branchDealroom has a profile for this one. Try Dealroom → to fund its purchase of a 51% stake in Zhongke Ruizhe Optoelectronic TechnologyDealroom has a profile for this one. Try Dealroom →. The loan carries a 120-month term.
Where does the money go? Proceeds will cover the acquisition's transaction price and fees, and replace part of the purchase price Shenxun already paid upfront.
How is it secured? Shenxun has pledged the 51% Zhongke Ruizhe stake and mortgaged real estate it owns. Actual controllers Tan Zheng and Nie Rong provided joint liability guarantees, while controlling shareholder Guangxi Tianfu Investment pledged 5 million company shares.
The signal: The debt-financed structure — layering share pledges, property mortgages, and personal guarantees — shows how mid-sized Chinese listed firms are stretching to bankroll acquisitions when cash alone won't close the gap.
Read more: sohu.com
Image credit: Ray in Manila
