Trick Morgan Stanley To make appliances "Mengniu" - Yongle, Dazhong, chain - HC Network Appliance Industry

The signal into the quagmire of capital Since lateraised to "intermediate" to reflect the acquisition
April 2006, Dazhong and Yongle "merger" after,of the management of the risks involved. JP
Morgan Stanley, Citigroup and other internationalMorgan will also Yongle's rating from "overweight,"
investment banks have published for the negativereduced to "underweight," target price reduced
evaluation of China Paradise. Prior to the financial28% to 3.40 Hong Kong dollars. Contrast is just
investors, China Paradise, listing sponsors Morgantwo months ago, Morgan Stanley also published
Stanley is once again jointly staged the originalresearch reports, maintain Yongle's "overweight"
story and Mengniu, could not wait to get out ofrating, saying that "the market for the Wing-lok,
cash. Double impact of China Paradise in the six2006, earnings projections were too
trading days shares fell 40%. Although the capitalconservative", to increase the Yongle annual profit
markets experience, "abandoned", but long-term inforecast of 6% -7%, while the Yongle target
the "Soviet hegemony" ( States United Statesprice increase from the 3.15 yuan to 4.20 yuan, a
And Suning Electric 0439.HK 002024.SZ) difficultrate of 33%. "Yongle and Dazhong announced the
to survive under the shadow of Paradise, seemsmerger, but is the right time, to the international
to have spent the nationwide merger integrationinvestment bank, cash in an appropriate reason."
"hibernation period." The use of capital leveragedYongle listing process, a participation of internal
from "regional powers" to national hegemonyfigure, Morgan Stanley as financial investors
ambitions begin demonstrated. Morgan cooperationParadise , listed in the Paradise last October when
with Mengniu, China Mengniu Dairy has beenhe signed in the second half of "lock-up
making the territory of Xiongbayifang. Morganagreement", in this period, its 20% stake held by
trick, whether the same success Wing-lok?Wing-lok, no transfer of the capital markets.
Morgan Stanley cash As "51" during the HongHowever, on April 25 this year "lock in" automatic
Kong stock market is not closed, Paradisetermination, the international investment bank
crashing the stock failed to obtain relief. May 2,Morgan Stanley, stock prices for Paradise
Wing-lok, close to 2.575 Hong Kong dollars to"Xianyanghouyi" means cash in fact "clear enough"
close at a record low share prices during theof. Consecutive adverse reports issued after the
year, close to half a year ago when the IPO issueunit of Morgan Stanley MS Retail, CDH, TonyLey
price of 2.25 Hong Kong dollars. The April 21, Wingand RetailManagement such as equity participation
Lok has just hit the highest price of 4.30 Hongfund, announced a price of HK 3.225 per share
Kong dollars during the year. As a listed company,totaled 369 million shares sold in China Paradise
Wing-lok, are feeling the pursuit of profit of capitalshares of issued share capital 15.81%, cash of
market investors. But the Wing-lok, Chairmannearly 12 billion. Yongle effort Investors to
Chen Xiao said the price Change in the normal"badmouth" Paradise, is becoming the capital
range. "Main before the merger price of 4.30 Hongmarket benchmark. Yongle and Dazhong in
Kong dollar is too high, is currently in the callback."accordance with the "merger" plan, Yongle will pay
Xiao-case interpretation. Shares rise Paradise "highfor large and medium end of this year 150 million
dive," one of the major international investmentyuan, "deposit." How to raise this large amount of
bank's continuous negative reports. April 24,money, certainly in terms of the Paradise is a
Yongle and Dazhong announced the merger ofgreat challenge. According to the announcement,
the first trading day after the Paradise sponsorsParadise will be held on May 26 annual
listed issuers, Morgan Stanley said in a report: "Asshareholders meeting, the agenda of the program
the costs rise velocity is greater than expectedfor the implementation of the allotment. This is
decline in earnings is expected to Yongle yearexactly the same prediction with the United
25% -27%" , while Paradise rating fromStates. Home Appliances Chain industry, "started
"overweight" from "and the markettaking" has been prevalent for many years. June
simultaneously," target price reduced to 3.95 from2004 Eagle GOME backdoor listing in July 2004
the 4.20 HK dollar. Citigroup predicts, Paradise inSuning in the A shares listed on the SME board, a
the third quarter of the allotment of new shareslisted home appliance chain financing as a tool for
and fund-raising to pay for acquisition of large andlong-term reliable expansion. Today, medium and
medium funds, therefore, reduce the Yonglelarge accelerated acquisition of Yongle invested
Citigroup price target of 6% to 3.20 Hong Kongheavily enclosure, so that international investors
dollars, while Wing-lok's risk rating from "low"felt manage risk.