{ "docId": "019dd923-622c-750b-8b96-835a69513742", "docSlug": "c47ae4d76596", "documentTitle": "China Huishan Dairy Holdings (6863 HK)", "authorId": "51_Muddy_Waters", "authorName": "Carson C. Block", "documentKindSlug": "research-note", "documentKindLabel": "Research note", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2016-12-16 00:00:00", "orientation": "portrait", "aspectRatio": 0.77272725, "pageNumber": 24, "pageCount": 47, "prevPage": 23, "nextPage": 25, "slideType": "precedent_table", "function": "expose_contradiction", "density": "overcrowded", "nDataPoints": 12, "notes": "The slide highlights the complexity and potential obfuscation in corporate naming conventions, specifically linking Huishan Dairy to Liaoning Muhejia.", "elementsJson": [ "data_table", "photo", "paragraph", "footnote" ], "metadataConfidence": 0.95, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b96-835a69513742/24", "deckHref": "/decks/019dd923-622c-750b-8b96-835a69513742", "deckJsonHref": "/decks/019dd923-622c-750b-8b96-835a69513742.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b96-835a69513742#slide-24", "components": [ { "bbox": null, "kind": "callout", "text": "Huishan's disclosures about Liaoning Muhejia refer to it by an informal English name, Liaoning Ainyveal, which we also believe is an attempt to obscure.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-2b64-7193-87f6-cdbe565baa51", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.18, "w": 0.76, "x": 0.12, "y": 0.415 }, "kind": "image", "text": "Signboard at Muhejia complex in Zhangwu, ghosts of prior company names can be seen on wall in background.", "attrs": null, "subkind": "photo", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "f32bc232-ead2-4782-9e8b-f03bd8012692", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.05, "w": 0.76, "x": 0.12, "y": 0.775 }, "kind": "list", "text": "April 11, 2014: Huishan establishes Huishan Investment Fuyu Shenyang Farming Company (“Fuyu”) for “dairy farming business”. (As we explain below, it seems likely", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "d7c80468-0def-468d-bafe-4b6499417422", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.04, "w": 0.76, "x": 0.12, "y": 0.725 }, "kind": "paragraph", "text": "Huishan transferred the Fuyu farms to Muhejia, an entity controlled by Yang Kai. The following timeline lays out the key events:", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "0f035518-209f-4800-9ae3-d1caf1cda9c6", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.05, "w": 0.76, "x": 0.12, "y": 0.638 }, "kind": "paragraph", "text": "Huishan’s disclosures about Liaoning Muhejia refer to it by an informal English name, Liaoning Ainyveal, which we also believe is an attempt to obscure.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "ad6163a5-d06b-4bc5-9514-79e7afebe287", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.76, "x": 0.12, "y": 0.84 }, "kind": "source-note", "text": "43 Huishan Group, however, disclosed a business agreement with Liaoning Ainyveal as a connected party transaction with Chairman Yang Kai in September 2015. (See http://www.Huishandairy.com/Investor/EN_20150926.pdf) To confound matters further, Huishan’s 2016 annual report continues to refer to Liaoning Ainyveal, with Kai and his spouse indirectly owning 66.7%, even though its name has changed three times since then. (See http://www.Huishandairy.com/Investor/EN_20150926.pdf and Huishan FY16 AR, p.68) 44 Huishan FY14 Annual Report, p. 146.", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "02ea360e-cc7f-4aba-8247-82b2298dd876", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.295, "w": 0.456, "x": 0.277, "y": 0.093 }, "kind": "table", "text": "Current/Prior Name, Chinese Name, Date of Change; Fuxin Blue Moon Foods Co. Ltd., 阜新蓝月亮食品有限公司, -; Liaoning Fuda Cattle Co. Ltd., 辽宁福大牛业有限公司, 12/12/2014; Muhejia Livestock Technology Holding Co., Ltd., 牧合家畜牧科技股份有限公司, 12/8/2015; Zhangwu Fuda Cattle Co., Ltd., 彰武福大牛业有限公司, 1/20/2016; Liaoning Muhejia Livestock and Technology Co., Ltd., 辽宁牧合家牛业科技有限公司, 4/5/2016", "attrs": null, "subkind": "data", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "a2aec865-ee5a-49fe-97df-bab340d4250d", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.46, "x": 0.27, "y": 0.09 }, "kind": "title", "text": "Table 1: The Many Names of Liaoning Muhejia", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "b4f8a474-5898-441b-9ea7-8410e9bce6b7", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.02, "w": 0.15, "x": 0.12, "y": 0.69 }, "kind": "title", "text": "F.U. with FuYu", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "f25f4440-0f69-49c9-88b5-0530e10da366", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [], "arcBeats": [], "loops": [ { "to": 29, "from": 23, "name": "The Reveal", "slug": "05-the-reveal", "bestFor": "Product launches, strategic pivots, unexpected findings", "matchId": "31338c39-90b7-4c50-b885-2138304840ab", "evidence": "The report reveals various instances of Huishan's fraudulent activities", "position": 1, "objective": "What is the extent of Huishan's fraudulent activities?", "structure": "Setup the Question -> Build Suspense -> The Big Reveal", "confidence": 0.7, "description": "Build mystery and anticipation, then deliver a surprising or powerful conclusion" } ], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }