Everbright Securities: Subsidiary’s overseas litigation results announced; will not have a significant impact on current or future performance.

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Reposted from: China Securities Journal·China Securities Network

China Securities Journal·China Securities Network (Reporter Lin Qian) On the evening of April 2, Everbright Securities released an announcement regarding developments related to its affiliated companies. The company had previously disclosed the status of related lawsuits concerning the overseas project transaction parties of Injin Xin Fund: JINXIN INC. (Cayman Injin Xin) and MP&Silva Holdings S.A (MPS), as well as the original seller-side shareholder(s) RICCARDO SILVA, ANDREA RADRIZZANI, and other individuals and institutions. Recently, Cayman Injin Xin received the judgment. The High Court of England and Wales ruled to dismiss all lawsuit claims brought by Cayman Injin Xin against the defendants RICCARDO SILVA and its special purpose entity RICCARDO SILVA HOLDING DESIGNATED ACTIVITY COMPANY, as well as MARCO AULETTA, regarding the alleged fraudulent misrepresentations.

Everbright Securities said in the announcement that the above judgment outcome is expected not to have a material impact on the company’s overall operating performance for the current period and after. At present, the company’s business and management operations are normal.

Public information shows that Everbright Capital is a wholly owned subsidiary of Everbright Securities. In 2016, Everbright Capital’s subsidiary, Everbright Jinhui, together with entities including a subsidiary of Storm Group, established the Injin Xin Fund, with a total scale of 5.2B yuan. In the same year, in May, the Injin Xin Fund purchased 65% of MPS’s equity at a price of 4.7 billion yuan. However, thereafter MPS fell into operating difficulties and was ultimately declared bankrupt and ordered liquidation by a UK court in 2018.

In February 2019, when the investment term of the Injin Xin Fund expired, it failed to complete an exit as originally planned. The interest-related parties of the fund’s two preferred partners (China Merchants Bank, Huari Bank) therefore filed civil lawsuits against Everbright Capital. After that, the Shanghai Financial Court ruled that Everbright Capital should pay the two banks a total of 3.52B yuan.

After years of twists and turns in MPS’s overseas projects, the announcement of the results of this overseas lawsuit indicates that MPS’s overseas troubles are coming to an end. Previously, Everbright Securities, based on the principle of prudence, had estimated potential losses and accrued provisions for expected liabilities. In 2023, Everbright Securities reached a settlement with two banks within mainland China, reversed part of the expected liabilities, and increased non-recurring income. With the completion of the related overseas legal procedures this time, the risk has basically been cleared out, and the MPS project will no longer have a material impact on its current operating performance or future development.

Everbright Securities’ 2025 annual report shows that, during the reporting period, the company achieved operating revenue of 10.85B yuan, up 13.06% year over year; and achieved net profit attributable to the parent company of 3.72B yuan, up 21.77% year over year. The company’s 2025 annual profit distribution plan is: it plans to distribute a cash dividend of 0.174 yuan per share to all shareholders (including tax).

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