This is an English adaptation of a FoodBud historical article originally published on February 18, 2022.
On February 18, 2022, the Shenzhen Stock Exchange terminated its review of Asian Seafood Port’s proposed initial public offering and listing on ChiNext after the application failed to pass the listing review.
Regulators focused in part on whether Asian Seafood Port met ChiNext’s positioning requirements around “three innovations and four new areas.” The company had submitted its ChiNext application in July 2020.
According to the exchange review, Asian Seafood Port did not fully explain:
The company was found not to comply with relevant provisions of the ChiNext IPO registration rules and Shenzhen Stock Exchange ChiNext issuance and listing review rules. Based on the listing committee’s view that the company did not meet issuance, listing, or disclosure requirements, the exchange terminated the IPO review.
According to the prospectus, Asian Seafood Port had RMB 412 million in cash and cash equivalents as of December 31, 2020. The company had planned to raise RMB 330 million, with RMB 250 million allocated to a central cold-chain processing project and RMB 80 million to the Qianjinbao supply-chain project.
For the central cold-chain processing project, Asian Seafood Port planned to build in Changlingzi Village, Changcheng Subdistrict, Lushunkou District, Dalian, within the Dalian Green Food Industrial Park. The planned site area was 38,062.11 square meters, with total planned floor area of 50,000 square meters.
The facility was to include a production dispatch and command center, dormitories, an R&D and product control center, production workshops, supporting cold storage, equipment rooms, and wastewater treatment facilities. The company planned to add 540 sets of equipment, including horizontal shelf plate freezers, beaters, and bowl cutters. After launch, the project was designed for 15,000 tons of capacity.
The Qianjinbao supply-chain project was intended to support a rapidly expanding business scale and improve production and delivery efficiency. It was to be implemented by subsidiary Qianjinbao Supply Chain Co., Ltd. The budget included RMB 17 million for new hardware and software development for an internet-based management platform, RMB 33 million for warehouse leasing across 12 new national warehousing and logistics nodes, and RMB 30 million in initial working capital.
Asian Seafood Port’s controlling shareholder was Yayu Industrial, with a 59.73% stake. The actual controller was Jiang Xiao. Its investor base included New Hope and Meituan-linked entities.
Houyi Investment and New Hope Investment held 7.47% and 6.42%, respectively, making them the third- and fourth-largest shareholders. New Hope Investment is a wholly owned subsidiary of New Hope Group and contributed 86.35% of Houyi Investment’s capital. Together, the New Hope system held 13.89% of Asian Seafood Port.
Tianjin Zhongmei was the second-largest shareholder, with 9.96%, and its ultimate controller was Meituan. Longzhu held 4.98%. The prospectus stated that Longzhu’s executive partner was Ningbo Meishan Bonded Port Area Meixing Investment Management Co., Ltd.; Meituan controlling shareholder Wang Xing held 29.9% of that company, Meituan senior executive Chen Shaohui held 15.1%, and Zhu Yonghua held 55%.
Meituan co-founder, executive director, and senior vice president Wang Huiwen and New Hope Group vice chairman Wang Hang also served as directors of Asian Seafood Port.
After the proposed issuance, New Hope Investment and Houyi Investment would have held 4.81% and 5.6%, while Tianjin Zhongmei and Longzhu Investment would have held 7.47% and 3.73%.
Asian Seafood Port operated in the foodservice ingredient supply-chain sector, similar to Qianwei Central Kitchen, but with a different product focus. While Qianwei Central Kitchen focused on frozen rice and flour products, Dalian-based Asian Seafood Port was one of China’s largest seafood supply-chain companies, benefiting from access to marine resources and offering hundreds of prepared seafood products.
Its products were mainly frozen seawater processed and primary processed products, sold primarily to foodservice enterprises. Chain and end-customer foodservice clients included IKEA, Wallace, and Coucou.
The company described its core business as branded ingredient supplier and supply-chain services, combining a traditional industry with new technologies, business formats, and models. It focused on product R&D, brand and channel management, cold-chain distribution, quality control, and information-system management. Production was mainly outsourced.
From 2018 to 2020, Asian Seafood Port reported revenue of RMB 914 million, RMB 1.203 billion, and RMB 897 million, respectively. Net profit over the same period was RMB 64.122 million, RMB 70.5231 million, and RMB 46.9767 million.
In 2020, revenue fell 25.48% year on year, while net profit fell 33.39%. Revenue from deep-processed products declined 23.73%, and revenue from primary processed products declined 45.92%.
Sales were concentrated in East China and North China. In 2020, those regions accounted for 45.97% and 19.71% of sales, respectively.
From 2018 to 2020, revenue generated by newly added distributors was RMB 41.4288 million, RMB 43.1149 million, and RMB 29.0271 million, accounting for 6.45%, 6.41%, and 5.61% of distributor revenue. The company’s distributor revenue therefore remained mainly dependent on existing customers.
For deep-processed products, distributor channels accounted for about 70%, mainly through buyout-style distribution. The company had built a nationwide distributor management system by region and product. As restaurant standardization and chain development increased, Asian Seafood Port also sold directly to large chain customers such as IKEA, Wallace, Dalian Tongdelai, and Coucou.
It also used its self-developed online supply-chain management platform to supply smaller foodservice ingredient wholesalers and restaurant end users through direct sales.
In 2020, Meituan and IKEA were the company’s largest and second-largest customers, accounting for 6.99% and 2.24% of sales, respectively.
On the supply side, the top five suppliers accounted for 57% of procurement value in 2020. Asian Seafood Port procured deep-processed and primary processed products from OEM manufacturers. Primary processed procurement was mainly shrimp products, with other categories including fish products, mixed seafood products, beef and lamb, and shredded kelp. The company also procured raw materials for self-produced products, including shrimp and other primary processed categories such as fish and abalone.
Note: IPO, fundraising, capacity, ownership, and forward project figures are historical and reflect the company’s 2020 prospectus and the 2022 exchange review context.