Yangtze River Port and Logistics Limited (YRIV) Developing Story

Tracking the nasty developing story about the short attack of Hindenburg et al against YRIV on 2018-12-06. The most remarkable development in this case is that YRIV filed a defamation lawsuit in NY against the short seller on 2019-01-23, taking the full risk & responsibility to disclose all related information within the discovery phase. Usually short seller hope their target will never sue them to avoid disclosing any information in the process. Not so here, YRIV shows strong confidence.

Please read the Disclaimer / Disclosure first. You can find more about YRIV here.

I will update this blog entry to reflect new information, thoughts & aspects.

  • 2019-03-06 Initiated DD, added more details (SH lawsuit, CMCM comparison, ..)
  • 2019-03-07 Adding ‘Cause of Action’ items of the two complaints; Adding Class-Action-Suit; Adding ‘Short Play’ chapter w/ SI
  • 2019-03-08 More color on debt & value from refutation & 10-K, also read comments!
  • 2019-03-09 Added chapter ‘The 2015 Wuhan Newport Asset Swap Deal”, clarifying some questions.
  • 2019-03-11 Added Conclusion, minor edits and coverage on SA
  • 2019-03-12 Added detailed Weekly & Daily chart w/ Fibonacci
  • 2019-03-17 Added impact of Reduced Ownership by 27M shares from Majestic Symbol, Crestlake, Fortunate Drift and Coleman (=Best Future Investment)
    • Timeline: Added Ownership Change
    • Updated ‘Short Play’, increased SI
    • Added sub-chapter: ‘The 2nd Stage Selling’ after ‘Initial Thoughts’
    • Updated Chapter ‘The 2015 Wuhan Newport Asset Swap Deal’
    • Updated Chapter ‘Conclusion’

Brief Overview & Initial Thoughts

The Short Play

Looking at the NASDAQ’s YRIV Short Interest (SI) Data, it is obvious that short sellers well prepared their attack while loading their position upfront before the release.
Usually they kick-off high volume selling in the opening with the release, to create the desired effect of the short confirmation bias. The usual play, then things take their turn by themselves with all the ambulance chaser spamming the news channel and panic.

Settlement Date Short Interest Avg Daily Share Volume Days To Cover
2/28/2019 874,879 4,869,006 1.000000
2/15/2019 597,960 1,610,637 1.000000
1/31/2019 508,827 218,421 2.329570
1/15/2019 583,094 113,925 5.118227
12/31/2018 636,223 511,980 1.242672
12/14/2018 873,529 1,926,162 1.000000
11/30/2018 659,465 308,384 2.138454

Interesting to note these days is that there seem to be no shares to borrow available to short from the usual source, see

So it might be unclear how they continue to suppress the stock price here, they could have covered and loaded, then playing the stock for a little while.
The risky part in their game is that no options are available to hedge their short position with call options.
But I am sure that today on 3/7, the SI will be below 500k shares again. After all a relative small play considering all the efforts and the fact that they are being sued twice now.

Initial Thoughts & Opinion

Usually Hindenburg & Co’s short attack last for only a short while, pun intended. They feel safe, since usually the stock recovers and the targeted company prefers to focus on their core business and would not like to risk full information disclosure in a lawsuit’s discovery process. Not so here, the short seller got server with a law suit. Something went wrong 😉

The short allegations, especially the financing part, seems to be a typical short story line pushed on Chinese companies. It sound a bit familiar with the previous 2017 CMCM short attack, which also got fully refuted.

Valuation wise, stock was traded above $11/sh or $1903M MCAP value on 2H18, which is about 3.17 times today’s land use rights appraiser of $600M.

Historically the stock traded at certain levels for a long and stable time period:

  • 2011 $5/sh or $105M MCAP w/ 21M OS
  • 2012-2015 $0.10 – $1 or $2M – $21M MCAP w/ 21M OS
  • 2016 $4 – $7 or $712M – $1246M w/ 178M OS
  • 2017 w/ $4 – $18 or $776M – $3492M w/ 194M OS
  • 2018 w/ $3 – $12 or $519M – $2076M w/ 173M OS

Here the detailed Weekly chart with the Fibonacci covering down to top over the whole Wuhan Newport asset ownership period. It shows a clear $3.38/sh support also covered in the Fibonacci, hence should be recovered in the next periods.

Same in detailed Daily Chart with above Fibonacci but just ~ 1 year


The 2nd Stage Selling

We see the stock price decline in roughly two stages

  1. 12/3 $11 -> 1/4 $4
  2. 1/4 $4 -> 2/19 $0.40

After company & shareholder filed the lawsuit against the short seller, on 2018-01-28 the latter – at least four shareholder reduced their stake about 27M shares significantly, representing more than 50% of their stake.

The second stage decline from $4 down to 40 cents was probably due to these sales. Since they all received their shares at a $10 valuation, they have effectively lost considerable value – at least on paper. Lots of speculations are circulating around these, a few random thoughts are

  • They realized all of a sudden that there is no value – after filing the lawsuit against shorts 😉
  • Unlikely panic sales at a loss and they could have sold higher earlier
  • Fraud usually has the goal of profit taking, here sellers took a loss
  • Coleman is still employed after selling at a loss and driving price lower
  • These funds may have acted together, intentionally depress the stock to….

While the short attack itself is a usual short & distort known game plan, these sales are the most puzzling part of the decline.

Project: Wuhan Yangtze River Newport Logistics Center

Wuhan is the capital of Hubei province and is the most populous city in Central China with a population of roughly 19M in 2015 in the Metro area. Province Hubei’s population is around 59M in 2015.

The Yangtze River is the longest river in Asia and the third-longest in the world. The river is the longest in the world to flow entirely within one country.

The project Wuhan Yangtze River Newport Logistics Center is located in the middle reaches of the Yangtze golden waterway. See the other items in previous project link for details (location, planning and partners).

To be continued …

The Past

The 2015 Wuhan Newport Asset Swap Deal

On 2015-12-29 the entity [Energetic Mind -> Ricofeliz -> Wuhan Newport] took over ‘Kirin International Holding‘ in a asset swap deal valued at with company’s common stock at $10.00 per share or an aggregate of $1510M.

Kirin International Holding‘ is today’s YRIV.

Note that this swap was actually a reverse M&A deal, were the ‘Acquiree Energetic Mind Limited, Hong Kong, Attention: LIU Xiangyao‘ became the new owner of YRIV and the ‘Acquiror GUO Jianfeng‘ exited.

Mr LIU Xiangyao was the controlling shareholder of Energetic Mind (parent) and hence Wuhan Newport (sub), hence he likely is also the debtor of the above discussed $120M due loans which were guaranteed by Wuhan Newport.
The short refutation from 2018-12-12 (see above) says that this debtor is now solely responsible for these loans and hence Wuhan Newport cleared of these leans and therefore YRIV, a strong positive and company is even suing the short defamation.

Mr LIU seems to be wealthy enough, as he even bought shares for $1.7M in December for around $5 per share, stock didn’t even hit bottom yet.

The curious part here is that YRIV was willing to swap out ‘Wuhan Newport’ for ‘Wuhan Economic Development’ assets for an additional $90M cash payment while the new assets represented a lower property value! See the comment elaborating on the 2018 failed transaction and debt situation.

None of YRIV’s note holders including Mr LIU is able to get paid currently, as the $300M S-3 shelf can’t be executed at the current price level. This offering would have actually marked the very first market valuation via a secondary offering and company claimed in its complaint that underwriter were willing and able to execute it without warrants, another positive. This offering is now naturally on ice since the short attack.


The 2015 transaction also clarifies the question of the sold shares of Director Mr Coleman. Mr Coleman represented the ‘Acquiree Shareholder Best Future Investment LLC, Great Neck, New York.

Best Future Investment LLC received 4.98M shares of today’s YRIV in above swap deal, like Mr LIU and others.
The Form 4 sales transactions state that ‘James S. Coleman is the Managing Member of Best Future Investment LLC‘ and were performed for their Indirect Beneficial Ownership. Mr Coleman probably never owned any of these shares personally, but acted as a trustee.
Mr Coleman holds all membership interest in Best Future Investment and therefore is identical with the same.

Best Future Investment LLC is a ‘Foreign Limited Liability Company.


Here is a better overview of the beneficial Acquiree Shareholder, who reversed swapped themselves into YRIV. And voila, we see 4 of the 7 shareholders here who have sued the short seller Hindenburg et al:

  • Crestlake 16.6M shares
  • Majestic 16.6M shares
  • Fortunate Drift 16.6M shares
  • Start Well 4.98M shares

additionally the following entities have received shares:

  • Jasper Lake (Mr LIU now CEO)
    • 91.24M shares and
    • 8% Convertible Promissory Note in the principal amount of $150M
  • Best Future Investment 4.98M shares

Total: 151M shares @ $10/sh for $1510M book value + $150M notes = $1660M book value.

Note: Additional 3 shareholder suing are: Prolific Lion, Valiant Power and Solid Wise.

Note: None of them has sold significant amounts of their shares until today but Best Future Investment LLC.

Note: Majestic Symbol, Crestlake, Fortunate Drift and Coleman sold 27M shares since filing the lawsuit on 1/28, more than half of their stake.


It is theoretically possible that these asset swap deals have inflated the value, but this is a mere speculation and none of the participants have profited from the deal yet.

‘3rd party appraiser of 515,600 sq meters land use right value to $600M’.
Enterprise Value (EV) is just ~ $211M @ 50c/sh and 173M OS, hence $600M EV gets us to $2.75/sh for that land alone not considering the revenue potential and the 1.2M sq meters lease. Interesting to note that $3.50/sh was roughly the floor area of last years trading.

From 2016 to just recently, the market has matched & confirmed the 2015 swap valuation and the MCAP went even above the $1660M overall transaction value.
Additionally the 8% convertible note holder agreed upon the $10/sh conversion price.

Majestic Symbol, Crestlake, Fortunate Drift and Coleman selling 27M shares, more than half of their stake at a great book value loss, is the most irritating play in recent developments here. This has reduced overall ownership from 159.75M (92.34%) to 132.74M (76.73%).

Knowing that ~77% of the original Wuhan Newport stake is still being held by the original owners, they altogether sue the short seller and are willing to disclose all information in the process – may lead to the conclusion that the owners are very confident on the rightful value of the property and project. Only the 50% stake reduction of above mentioned owners at a loss is heavily irritating.


56 thoughts on “Yangtze River Port and Logistics Limited (YRIV) Developing Story”

  1. I see $YRIV project much easier and profitable to realize (assuming all is real) than for example NAK’s mine.
    In this case a full recovery is possible and should be expected. We will see.


  2. Plaintiff asks for a minimum of $500k damages ..

    1/25 Amended Complaint https://iapps.courts.state.ny.us/nyscef/ViewDocument?docIndex=qEmSEWYd76TwB0sgBXrWrA==

    2/13 IT IS FURTHER STIPULATED AND AGREED that the time by which each of the Stipulating Defendants must serve an answer or otherwise respond to the complaint, shall be and hereby is extended up to and including March29,2019; https://iapps.courts.state.ny.us/nyscef/ViewDocument?docIndex=tK5NmLQbU_PLUS_PJGtO1sMddMg==

    2/13 Defendant wants case to be assigned to the commercial division (re business torture)
    Request for Judicial Intervention

    Well, it is marked as “Case Type: Commercial Division” anyways.


  3. Turns out YRIV’s lawsuit against Hindenburg has been followed by a 2nd one from YRIV shareholders

    Plaintiffs here are

    Majestic Symbol Limited, Crestlake Holdings Limited, Fortunate Drift Limited, Start Well International Limited, Prolific Lion Limited, Valiant Power Limited and Solid Wise Limited.

    150879/2019 – New York County Supreme Court
    Short Caption: Majestic Symbol Limited et al v. Hindenburg Research et al Case Type: Commercial Division
    Case Status: Active

    1/28 Complaint https://iapps.courts.state.ny.us/nyscef/ViewDocument?docIndex=a3n0/483tbX16Z_PLUS_7QKl4Qg==


    1. Parties w/ more than 16.6M shares. Seems like Mr Anderson & Co did the wrong turn on this one?
      Will this become the Hindenburg event?

      From $11.62 on 12/4 -> $2.58 on 1/24:
      – Majestic symbol has 16.6M shares and claims a minimum $150M unrealized losses (they are holding)
      – Crestlake has 16.6M shares and claims a minimum $150M unrealized losses (they are holding)
      – Fortune Drift has 15.46M shares and claims a minimum $140M unrealized losses (they are holding)
      – Start Well has 2.72M shares and claims a minimum $25M unrealized losses (they are holding)
      – Prolific Lion has 13.78M shares and claims a minimum $125M unrealized losses (they are holding)
      – Valiant Power has 1.75M shares and claims a minimum $15.78M unrealized losses (they are holding)
      – Solid Wise has 1.72M shares and claims a minimum $15.56M unrealized losses (they are holding)

      In total: 68.63M shares and a minimum loss of $621.34M
      These losses have even increased by now as stock went lower.
      Very sizable big numbers here.

      The $500k damages claim is only the bare minimum, as being visible above.


  4. CEO Mr Liu holds 91.24M shares https://www.sec.gov/Archives/edgar/data/1487843/000121390018017364/xslF345X03/ownership.xml

    For some reason, Mr Coleman was forced to sell some of his stake on the way down. Margin call, tax or cash needs?
    He is surely not as rich as the CEO. Always big drama when things like this happens.
    But he probably gets rewarded afterwards.

    Insider transactions https://www.sec.gov/cgi-bin/own-disp?action=getissuer&CIK=0001487843


  5. Much more damages than $500k, the 7 SH have unrealized losses of more than $670M now for their 69M shares. Lawsuit goes for full INTEND for gains of their short play, implying full liability.
    Based on the complaint, doing this short & distort for own & their clients profits is not a ‘public service’.
    This is an important detail, since ‘public service’ DD is OK, but now they are fighting back and showing short sellers own claims: For profits.


  6. “Our team .. ” on the ground etc as short sellers claim. Oh do we remember their ‘team on the ground’ in the APHA case? In the end one hired guy trying to locate a place and failed.
    (BTW, I am no fan of APHA here and that company did not refute a thing until today AFAIK)

    Claims w/o reference and proper location and language like ‘we believe’ and ‘probably’ just exists to save their behind in .. drumroll .. lawsuits. But that is not enough if bad intend will be proven.
    Popcorn if they have to disclose all their short partners and clients.

    Surely more to come here…


    1. If they hired a local ‘on the ground’ via the internet to make favorable statements to their client (here the short seller), I wouldn’t be surprised at all 😉


  7. Above article also shows the trading levels and hence valuation before the short attack, so SH were OK with the pre-revenue status and gave company a higher valuation on the potential.
    This thought for the still zero revenue of this project.
    Usually when these extreme value plunges happen, it will recover on refutation to a good point – maybe not everything.
    But the SH also will buy more and make themselves whole again. Looking at the SH lawsuit against the short seller, they probably can. Where this point might be? I don’t know.

    Multiples of the appraisal value of $600M or the projected revenue? Nobody knows.
    Interesting stuff for sure.


  8. So SI is decreasing since the attack – of course https://www.nasdaq.com/symbol/yriv/short-interest
    They loaded their short position upfront, proof in the pudding.
    Usual strategy.

    What would be interesting is when the big SH and insider start loading now.
    10-K has been filed on 3/1, lawsuit has been filed and the related quiet period might be over now?
    I would think so.


  9. Last thought from the complaint, the offering is of course on ice at these price levels.
    So I guess CEO Mr Liu will again give his company an advance until things recover a good part.

    The damages of all of this will be significantly higher than $500k, that is already clear.
    It goes into the hundred of millions for the company and the SH, as of today.
    Curious how stock will recover on clearing the company from these allegations.


  10. Plaintiff YRIV seeking actions (amended version):
    1) Defamation Per Se p20
    2) Defamation p22
    3) Tortious Interference With Prospective Business Relations p23
    4) Tortious Interference With Contract p25
    5) Civil Conspiracy p26
    6) Common Law Fraud p27

    Plaintiff 7 SH seeking actions:
    1) Prima Facie Tort p26
    2) Civil Conspiracy p27
    3) Unjust Enrichment p28
    4) Deceptive Trade Practices under Gen. Bus. Law para 349 p30
    5) Common Law Fraud p31


  11. Similar as with the CMCM case, the ambulance chaser lawfirms found a ‘lead plaintiff’ with only a handful of shares,
    see https://finesand.wordpress.com/2018/11/30/cheetah-mobile-cmcm-an-outrageous-unfounded-accusation-short-attack/

    Here Rosen & Co got one in January 2019 with just 112 shares p13 / Exhibit 2: https://drive.google.com/file/d/1kE8NRQKCiTFbfOpxmEWY2_auf0E95FWd/view
    Surely they continued their search but failed.

    Will it matter? Usually not at all, they will get rejected eventually and nobody cares. Same as with CMCM and other frivolous accusations and lawsuits.

    Good thing is the ambulance chaser deadlines are behind us and the news channel is clear again 😉


  12. Again re ambulance chase aka class action suit, seen that 100 times all the same, read my CMCM blog about some details and you will ROTFL:

    – that’s what ambulance chaser do, they file 100, 1000 of these things and hope that 1 might be successful
    – they copy & paste the short ‘thesis’, no big effort and push out the plaintiff search spamming news
    – their case usually gets rejected
    – our case against the short seller is to show them to be fraud

    The last point is which differentiates this situation strongly from like CMCM, YRIV and their big shareholder sue the short seller. Company is willing to go to court and battle it out to the blood while accepting to disclose all information in the public. I really like that. Why?

    It is hard to come clean after such a short attack and bring back your stock value to previous price levels.
    CMCM is still struggling but recovering, GURE had a short attack years ago but never did (additional issues now).
    APHA even had to admit some dealings were not optimal (to my knowledge lol).

    Now YRIV goes full contra and attacks, accusing the short seller of having committed fraud, intentional price manipulation and what not (see list above).
    This move alone should give company enough credit to recover, no fraudulent company would risk this move. Because if YRIV would have done illegal dealings in the past, everything would come to surface in this process.


  13. Is this a reputable source site?
    Are we reputable?

    This is our little blogger website as you could see with your own open eyes.
    Why are we reputable? We do not get any compensation, nor do we have any clients.
    Unlike super shorts like Hindenburg or long penny stock promotion sites, we are independent and are not getting paid.
    Here, we did our initial DD reading the typical short accusation and YRIV’s lawsuit against them and like the case.
    Yes, we went a little long – so to speak.

    Whether our work is reputable (or any other work on this planet), it is up to you to decide Sir.
    Read, verify and build your own opinion.
    Good luck.


    1. Thank you. I am always interesting in these special situation where certain entities manipulate the markets.


  14. Open Questions
    (1) Selling pressure w/o shorts, how is that possible?
    Assumption is/was that some HFTs are swinging in this range, dunno.

    (2) Why did Coleman sell 50% of his shares $2 -> $0.33?
    Assumption is/was that he either had a margin call, sudden cash needs .. nobody knows for sure.
    A more sinister spec is that he either plays the stock down for cheap shares to the long SH or that outlook is worse.
    By worse it could mean Liu is all of a sudden ending support, not giving more advance and doing the offering here.
    A shorts wet dream so to speak. But then the whole lawsuits wouldn’t make sense here or would it?


    On another note, on person suggested they may have a rights offering at high premium from here,
    but huge discount from the asset value at above $3 – backstopped by Liu and SH.
    This in combination with a Chinese bank refinancing.
    Interesting rumor.


  15. Appreciate your breakdown and explanation of all the events. Seems to me that this ride is getting ready to get very interesting and justice will soon be served. Thank you!

    Liked by 1 person

  16. 10-K’s GOING CONCERN note is interesting to read, especially at current SP levels, forbidding company to go forward with their planned stock offering. The complaint explicitly states the drama with the very same S-3, as they originally negotiated a strong stock offering w/o Warrants. Now after the attack the underwriter only offers toxic dilution with Warrants attached. The complaint reads to me like this is a no go at current state.
    This fact multiplies the damages the short-attack has caused, naturally – and sort of has put company in a horrific financial spot.
    But then again, here is the GOING CONCERN note, which reads:

    As shown in the accompanying financial statements, the Company has sustained recurring losses and negative cash flows from operations. Over the past years, the Company has been funded through a combination of bank loans and advances from shareholders. On January 29, 2016, the Company received an undertaking commitment letter provided by the Company’s majority shareholder who is willing to provide sufficient funding on an as-needed basis. In addition, the Company plans to dispose of the existing developed real estate properties with market value of approximately $42 million when the Company needs cash flows. The Company believes that, as a result of these, it currently has sufficient cash and financing commitments to meet its funding requirements for a reasonable period of time.

    Therefore it would not be out of the world to see an eventual backstopped rights offering (to buy shares) at premium levels, which would ignore current valuation and gives these investors believing in the project a great deal.

    Trading wise, well, stock is still slipping lower and could potentially close the little gap at 45c, while I believe 40c should hold. In case one believes in the value this is an outrageous cheap price, otherwise I understand trader to see this as a huge risk just by looking at the chart.

    So remaining question is still, why did Coleman sell off his own personal stock from $2 -> $0.33?
    He should know the value, as he is the US representative for the whole US administration of the company.
    I would love to talk with him personally about it, but that is probably impossible 😉


  17. A Troubled Chinese Company Is Seeking a Lifeline From U.S. Investors
    By Bill Alpert
    Aug. 27, 2018 7:35 a.m. ET

    – Plan to build a large port and logistics facility on the Wuhan waterfront
    – Plan to swap: Wuhan Newport project for assets worth a mere quarter of company’s total market value of $11.64/sh ($2B) on 8/27/18
    – Plan to swap: ‘Wuhan Economic Development’ part of Wuhan waterfront acquisition of swap.
    – Plan to swap: Pay $90M to swap everything it owns for another riverfront business in Wuhan that the company’s own filings appraise at just $454M or $3/sh
    – $300M shelf intended for this transaction https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&filenum=333-223788&owner=include&count=40
    – Wuhan Newport valued at $400M since 2015, invested less than $2000
    – Wuhan Newport showed $120M in liabilities from lawsuits in Chinese filings
    – Co: No litigation nor debt re Wuhan Newport when swapped
    Co: Has deb of $43M from Chinese Construction Bank with missed payments for the last two years
    – Co: Another $70M in judgments against Newport not filed, b/c Newport’s original controlling stockholder has promised to repay the loans, which Newport had guaranteed and gotten sued for
    – Co: The swap shall cure all these issues
    – But in 2017, Wuhan Economic Development Port’s three-berth river terminal lost $35 million on less than $5 million in revenue


    Embattled U.S.-Listed Chinese Company’s Key Deal Collapses
    By Bill Alpert
    Sept. 6, 2018 2:33 p.m. ET

    – Co hoped to come up with the $90M by selling up to $300M stock, but SEC didn’t EFFECT S-3 yet (It has on 2018-09-13)
    – Swap deal collapse leaves Co with its original property in Wuhan, Wuhan Newport


    Related to the critical $43M or RMB 325M debt to Chinese Construction Bank:


    As of December 31, 2018, we have an outstanding loan payable to China Construction Bank totaling $41,825,980. The loan has a maturity date of May 29, 2020. The loan is a floating rate loan whose rate (2018: 6% per annum and 2017: 6% per annum) is set at 5% above the over 5 years base borrowing rate stipulated by the People’s Bank of China. The secured bank loan with China Construction Bank contains certain protective contractual provisions that limit our activities in order to protect the lender. The risk of default may increase in the event of an economic downturn or due to our failure to successfully execute our business plan. Defaulting on our bank loans could result in loss of our collateralized assets and cause a material adverse effect on our results of operations.

    10-K Credit Risk p F-23

    On April 17, 2018, China Construction Bank filed a civil complaint against Wuhan Newport claiming the outstanding principal and interest of bank loan totaling approximately RMB 325 million. The loan and interest payable obligations have been disclosed and accounted for in the Note 8 and Note 10. On June 15, 2018, the civil complaint was adjudicated by the Court in favor of China Construction Bank to collect delinquent amount from Wuhan Newport by enforcement. Wuhan Newport negotiated a loan restructure with the bank and in the meantime, all payments due are suspended. As a result of negotiations, the bank has not instituted enforcement proceedings.


    Relates to Co’s rebuke of short attack on 2018-12-12: https://www.sec.gov/Archives/edgar/data/1487843/000121390018017274/f8k121218ex99-1_yangtzeriver.htm

    Item 7: The $43M or RMB 325M debt to Chinese Construction Bank loan:
    – Loan of RMB 290 million due to China Construction Bank Gangcheng Branch dated May 28, 2014 mentioned in the Report, plus interest totaling approximately RMB 325 million
    – The Company is in the process of negotiating a loan restructure with the bank and in the meantime, all payments due are suspended.
    – Also, as a result of negotiations, the bank has not instituted enforcement proceedings.

    The other liabilities:

    – Item 1-6: Property buyers doesn’t want to enforce judgement to sell back to company, value higher today. Wuhan Newport prepared to buy
    – As in the above Items 1-6, because a judgement has already been rendered, the Company has not disclosed it as an ongoing “Legal Proceedings”.

    – Items 8-11 refer to judgements obtained against Wuhan Newport as a guarantor for certain loans taken out by a large shareholder of Wuhan Newport before it became a subsidiary of the Company. Since the judgments were rendered, the shareholder has undertaken in writing to be solely responsible for all these loans without recourse to Wuhan Newport and has entered into a repayment plan with his creditor(s). Accordingly, no enforcement actions have been instituted against Wuhan Newport and in accordance with legal opinion from PRC counsel, there are no legal or financial liability accorded to Wuhan Newport.


    It is complicated 😉


  18. Only 1.77% of 151M shares of Dec 2015 $10/sh asset swap shares have been sold by 1 minority holder. The 2.68M sh of Best Future Investment (and not Coleman personally, he just represents them)
    Added chapter ‘The 2015 Wuhan Newport Asset Swap Deal”, clarifying some questions.


  19. ‘3rd party appraiser of 515,600 sq meters land use right value to $600M’.
    Enterprise Value (EV) is just ~ $211M @ 50c/sh and 173M OS, hence $600M EV gets us to $2.75/sh for that land alone not considering the revenue potential and the 1.2M sq meters lease. Interesting to note that $3.50/sh was roughly the floor area of last years trading.


  20. The decline from $11 support happened in 2 stages:
    (1) 12/3 $10 -> 12/26 $4
    (2) 1/4 $4 -> 2/20 $0.50

    Best Future Investment’s 4.98M (~2.3% ownership) sold at a loss in the 2nd stage via manager Coleman down to 2.32M (reduced by -53%).
    This could have been done intentional to allow certain parties to buy lower or just cold feed.
    All other 98% original asset owners at $10 held the stock and CEO even bought $1.7M more shares at $5.
    This might lead to a 1st stage recovery to $4 rather sooner than later.
    Then we will see what really happens.


  21. Added detailed Weekly chart with the Fibonacci covering down to top over the whole Wuhan Newport asset ownership period. It shows a clear $3.38/sh support also covered in the Fibonacci, hence should be recovered in the next periods…


  22. .. and still no shares available to borrow (for a short trade)

    – iBorrowDesk
    – interactivebrokers (usa.txt via ftp) – No YRIV listed in available stocks:

    Conclusion of last days/weeks can only be that certain HFTs were keeping this stock
    low to trade according to their plan, since the free float is less than 20M shares.
    As we go back up, the intention should be also quite clear: Accumulation and covering to go long.
    Over 90% of value has been lost since the short attack, so a recovery is overdue.
    May it be the 50dma or $3.38 Fibonacci level next, the 98% $10 Wuhan Newport owners are still heavily under water.


  23. half joke: This is an Inverse ‘Barry Honig’ play w/ Hindenburg as the inverse Honig antagonist: Dump + Recovery here.


  24. https://beltandroad.ventures/beltandroadblog/2019-belt-and-road-2nd-bri-forum-what-to-expect
    2019-01-06 The 2nd Belt and Road Forum: What To Expect From 2019’s Main Event?

    Following the inaugural Forum in May 2017, President Xi Jinping announced last month that the Second Belt and Road Forum for International Cooperation will be held in April 2019. Exact dates are yet to be confirmed, but the Forum will very likely be the major event for the Belt and Road Initiative (BRI) in 2019. The Chinese government are predicting that around 40 Heads of State will attend the Forum versus 29 in 2017. The first batch of guests have already been confirmed, and Russia’s President Vladimir Putin has unsurprisingly been confirmed as the most important foreign guest. Philippines President Duterte has also confirmed his attendance.

    2) An evaluation of Belt and Road 5 years on

    3) Focus on implications for business

    When Xi announced that the second Forum will be held in April 2019, he was at the APEC Summit in Papua New Guinea. Xi specifically mentioned that members of the Asia-Pacific business community would be welcome to attend the Forum. This marks a change from 2017 where attendees came mostly from governments and think tanks.

    There has been a growing appetite from business, both Chinese and foreign, to tap into the commercial opportunities that BRI presents. The Chinese government says over 80 State Owned Enterprises have undertaken 3,116 investment projects in Belt and Road countries to date. But the scale of BRI has also led more and more foreign firms thinking about how they can benefit from the BRI. For example, Western banks have also been betting big on BRI. Following HSBC, Citigroup announced it had appointed a veteran investment banker its head of Belt and Road Initiative-related banking and origination businesses.

    We expect the Forum to stress that the BRI is open to foreign company involvement and highlight examples of foreign companies already benefiting from BRI.

    And so on and so forth. Notable company’s target year 2021 and above mentioned 2017 + 5 years BRI evaluation.
    Investors from China and globally, hence a plan to either sell the Wuhan Newport project for profits over $10/sh or to attract premium investors is more reasonable than anything.
    The next even bigger forum will be held in April 2019.

    A very curious timing of he organized short attack, to say the very least.


  25. https://en.wikipedia.org/wiki/Port_of_Wuhan

    The Port of Wuhan is located on the shores of the Yangtze and Hanjiang rivers. The river channel is 10m deep during the wet season. As of 2012 the WHPG had 51 production berths, 122.45 km2 of port areas, 7,579m of quayside, 43.4 ha of warehouses.[2] Including all other minor operators, the port had 244 berths.[3]

    As of 2012, Wuhan Port had 24 port areas, of which 9 were the main Port Areas:[4]

    Jinkou Heavy Lift Cargo Port Area (金口重件港区)
    Tunkou Vehicles and Oil Port Area (沌口汽车与油品港区)
    Hanyang Container and Bulk Cargo Area (汉阳集装箱与散杂货港区)
    Hankou Tourist and Passengers Port Area (汉口旅游客运港区)
    Qingshan Ore and Steel Port Area (青山矿石与4港)
    Zuoling Dangerous Chemicals Port Area (左岭危化品港区)
    Yangluo Container Port Area (阳逻集装箱港区)
    Huashan Container Port Area (花山集装箱港区)
    Linsifang Coal Port Area (林四房煤炭港区): Under planning

    Cargo vessels on the Yangtze in Wuhan (2009)

    The planned reorganization of the port would create 15 port areas by 2020:[5]

    Hannan Port Area (汉南港区)
    Dengnan Operations Area (邓南作业区) Dry bulk cargo, general cargo, Ro-ro vehicles
    Shamao Operations Area (纱帽作业区) Ro-ro vehicles, bulk cargo and general cargo.[6]
    Junshan Port Area(军山港区): Ro-ro vehicles and general cargo.
    Tunkou Port Area(沌口港区):Ro-ro vehicles, clean cargo and urban supplies.
    Yangsi Port Area(杨泗港区) Tourism and passengers
    Wuhu Port Area(武湖港区): general cargo, oil and liquid chemicals.
    Yangluo Port Area(阳逻港区)Core of the port and focus of development. Containers.
    Linsifang Port Area(林四房港区): Coal transshipment
    Jiangxia Port Area(江夏港区): Dry bulk and ro-ro vehicles.
    Qingling Port Area(青菱港区): Clean cargo and urban supplies
    Qingshan Port Area(青山港区) Retain current functions
    Baihushan Port Area (白浒山港区) Containers, oil and liquid chemicals
    Qingfeng Port Area(青锋港区) Serving the Wujiashan Technology Economic Development Area. Hanjiang River
    Duoluokou Port Area(舵落口港区): General cargo and urban supplies. Hanjiang river
    Caidian Port Area(蔡甸港区): Retain current functions. Hanjiang river.
    Yongantang Port Area(永安堂港区): Preserve current functions. Hanjiang river.

    By 2030, the plan is for the port to have 422 production berths and a capacity of 251 million tonnes per annum.[7]


  26. Ma Guo stressed that research on Wuhan New Port emphasizes strengthening reforms and continuously improving shipping competitiveness
    March 13, 2019 Source: Changjiang Daily

    At the symposium, Ma Guoqiang said that in 2013, General Secretary Xi Jinping inspected Hubei, the first stop was Yangluo Port, and clearly proposed to make the Yangtze River basin a golden waterway. Last year, General Secretary Xi Jinping inspected Hubei again, stressing the Yangtze River economy. Belt development promotes high quality development. We must always keep in mind the general secretary of Xi Jinping, give full play to the advantages of the Yangtze River waterway, accelerate the construction of the new port, and build a world-class inland navigation hub.

    To achieve the above objectives, Ma Guoqiang emphasized that the core is to speed up the construction of international first-class port and shipping facilities, focus on improving shipping efficiency and efficiency, optimize port construction, enlarge and strengthen the core port, and build a number of professional ports. At the same time, significantly improve multimodal transport. The system improves the logistics network infrastructure, enhances the logistics transaction function, and promotes the integration and seamless integration of ports, warehousing, logistics, and processing. We must adhere to ecological priorities and technology leadership, actively build green waterways, and develop smart shipping; significantly reduce customs clearance time and improve logistics efficiency.

    Ma Guoqiang demanded that the reform should be intensified, the reform of the management system of Wuhan New Port should be promoted, and the forces of the city, district and enterprises should be integrated in accordance with the principle of “one city, one port and one subject”, and more social capital should be introduced to explore the optimal institutional mechanism; deepening Wuhan The reform of state-owned enterprises such as the Port and Harbor Development Group, the establishment of a sound modern enterprise system, the introduction of strategic investors, the acceleration of the establishment of a market-based selection and employment mechanism, the promotion of reorganization and integration of similar functions, continued to slim down and strengthen the body, revitalize assets and enhance efficiency. We must conscientiously implement the overall responsibility of strictly administering the party, strengthen the work style, create a business environment and production and living environment that match the status of a world-class port, and achieve comprehensive strengthening of party building and new port development.

    City leaders Cai Jie, Liu Ziqing, Zhang Xin, secretary of Wuhan Xingang Working Committee, and Tu Shanfeng, general manager of Wuhan Port and Navigation Development Group, participated in the survey.


  27. Wugang Containers held the “Online Appointment Acceptance Platform” conference

    (Wuhan Port Container site not updated regularly: http://www.whpcc.cn/)

    On the morning of July 4th, Wugang Containers held a press conference for the online booking acceptance platform of Yangluo Phase II Terminal in the Hanjiang Hall of Wuhan Convention Center.

    promote the continuous growth of the container throughput business of Wuhan Port, and enlarge and strengthen the container industry. We will launch an impact on the goal of building a shipping center in the middle and upper reaches of the Yangtze River, and strive to achieve the main channel status in the container transportation industry in Central China ….
    The online reservation acceptance platform is an open service-oriented functional platform independently developed by Wugang, and is the first online platform for accepting container business in the middle and upper reaches of the Yangtze River and Central China. It will be the domestic and foreign branch line. The shipping company, shipping agency, freight forwarding, and trailer company provide six kinds of services, such as suitcase acceptance, customs inspection, and national inspection.

    The successful holding of the conference marked the more comprehensive and convenient business acceptance function of Wugang Containers. The efficiency of Yangluo Phase II Terminal for customer service and social service will be fully accelerated.


  28. Freight train departs Chongqing for ASEAN countries
    Xinhua, March 13, 2019

    Southwest China’s Chongqing Municipality launched a new freight train on Tuesday to better serve transportation along the land-sea trade corridor.

    Rail transport takes about two days from Guoyuan to Qinzhou,” said Hu Qiang, vice general manager with the Sinotrans Chongqing Co. Ltd. “The total shipping time to southeast Asian countries will shorten to less than 10 days from 22 days via the Yangtze River waterway.

    Guoyuan is the largest port on the upper reaches of the Yangtze and a key point connecting the Yangtze River economic belt and Belt and Road regions, with 16 berths currently in use for 5,000-tonne vessels and an annual railway throughput capacity of 5 million tonnes

    Note that our Wuhan New Port in Yangluo is in the middle and connects to Chongqing via the Yangtze (Guoyuan) or by rail. Both very important interconnects.


  29. Company says “3rd party appraiser of 515,600 sq meters land use right value to $600M”

    Now let’s see a similar transaction in Sep 2017 (i.e. should be much more worth now, probably twice as much)

    RMB1,780M or $250M for Total site area 116,700 square meters in CHONGQING,
    which is the upper Yangtze transportation hub, similar to Wuhan but smaller, less value.
    So that is $2142.2/sq meter.

    For 515,600 sq meters, it would be $1105M worth.
    And since this is 2 years ago and at a lower tier location the value should be a multiple of that by now for resale.


    The impact of urban rail transit on commercial property value: New evidence from Wuhan, China
    September 2016


  30. Plaintiffs shareholder have 68.63M: Majestic Symbol Limited, Crestlake Holdings Limited, Fortunate Drift Limited, Start Well International Limited, Prolific Lion Limited, Valiant Power Limited and Solid Wise Limited

    Then the ‘weirdo manipulator’ Best Future Investment’s 4.98M (~2.3% ownership) sold at a loss in the 2nd stage via manager Coleman down to 2.32M (reduced by -53%).

    And CEO Liu owns 91.829M (91.24M Jasper Lake + 0.59M Ricofeliz)

    Total: 162.78M shares held by original asset owner.
    OS is 172.53M on March 1, 2019 (10-K)
    Leaves a tradable float of just 9.75M shares. OK, may add the 2.32M from the manipulator max: ~12M

    And no shorts available on IB (see above), so if this is not being played by HFTs, I don’t know what this is.


  31. Thank you for detailed overview, but I think you’ve overlooked something on page 61 in the latest 10-K (key date “as of Feb 28,19”). Please compare this to previous one and it will explain some of your frustrations voiced above. In addition short volume is often reported in excess 50% daily from various sites so I think shares are readily available for short sale just not everywhere and not to everyone.

    Liked by 1 person

    1. Thank you very much @YK, yes it may explain a lot here and I stand corrected, wow:

      Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

      2017 10-K as of 2018-03-08: https://www.sec.gov/Archives/edgar/data/1487843/000121390018002769/f10k2017_yangtzeriver.htm#a_020

      2018 10-K as of 2019-02-28: https://www.sec.gov/Archives/edgar/data/1487843/000121390019003416/f10k2018_yangtzeriver.htm#a_020

      Finding 1: Director Coleman = Best Future Investment Sold 43%

      (3) Mr. Coleman owns all of the membership interest of Best Future Investment LLC., which owns 2,316,000 shares of the Company’s common stock. Mr. Coleman may be deemed to be the beneficial owner of the shares of our common stock held by Best Future Investment LLC.

      So Coleman equals to ‘Best Future Investment LLC’ and he is not just merely a manager of it and he sold 43%, while being the US Exec Director. He is not ‘just’ a manager!

      Finding 2: More original Owner sold at a Loss / Higher Float
      OS 2019-02-28 ~ 173M
      More original owner sold at a loss 2018-03-08 -> 2019-02-28:
      Liu (Jasper Lake) 91.24M -> 92.24M
      Coleman (Best Future Investment) 4.06M -> 2.32M
      (All Directors 95.37M -> 93.56M

      Crestlake 16.6M -> 13.38M
      Fortunate Drift 16.6M -> 10.86M
      Majestic Symbol 16.6M -> (sold out or below 5% ownership?)
      Zhimin Chen (Prolific Lion + Valiant Power) 14.58M -> 14.94M

      Total: 159.75M (92.34%) -> 132.74M (76.73%)
      Float: 13.25M -> 40.26M

      So we had four sellers Majestic Symbol, Crestlake, Fortunate Drift and Coleman who were selling more than 50% of their stake altogether from 53.86M down to 26.56M. More puzzling is, they seem to have sold after filing the SH lawsuit on 2019-01-28 against the short seller at an extreme loss. Chen and CEO Liu increased their position a bit.
      I am impressed now and this opens up even more questions.

      Now the increased trading volume of about ~10M might be better explained by the given 40M float and it doesn’t seem to be kept, i.e. absorbed and reducing the volume.

      Always a problem when they don’t report a change in 5% Ownership via SC13* forms, which made me believe others did not sell.


  32. You got it! Since all holders filed together, they probably act together in the market in Imo.
    One can speculate that they decided to take advantage of this situation (which to casual observer would look like a continued price drop due to loss of confidence). The charts still show distribution not accumulation after all. It’s likely that eventually they will start buying back their shares or more and at a significantly lower average price than they sold. Now the question is at what price and how long would it take? By known records it looks like they sold between Jan 24 and Feb 28, care to give it a shot and calculate average? Also, it looks to me like additional selling happened on March 4, Imo insiders are totally in-charge of current price and will eventually cause it to significantly appreciate. Now, how’s that for a theory?

    Liked by 1 person

    1. I updated the article (as well as the brief copy on SA), thank you again YK.
      The new finding does clear up all the confusion about the SP movement and share availability.
      In new sub-chapter ‘The 2nd Stage Selling’ I dropped a few possibilities and IMHO non-possibilities like ‘panic sales’.

      In the end, I don’t know and the selling does confuse me. There is still the plain simple explanation that they just sold, but it doesn’t really compute that late and that low on no known event. They could have done this much earlier.
      It is weird at best.


    2. Coleman’s avg selling price is $0.8868 of 1.75M shares. For the other 25M shares sold we have no documents yet.


  33. 2019-03-17 Added impact of Reduced Ownership by 27M shares from Majestic Symbol, Crestlake, Fortunate Drift and Coleman (=Best Future Investment)
    Timeline: Added Ownership Change
    Updated ‘Short Play’, increased SI
    Added sub-chapter: ‘The 2nd Stage Selling’ after ‘Initial Thoughts’
    Updated Chapter ‘The 2015 Wuhan Newport Asset Swap Deal’
    Updated Chapter ‘Conclusion’


  34. Here the list of Legal proceedings, seems they are all closed: Judgements against company to pay back the $43M loan w/o enforcement so far and to repay sold but not delivered offices w/ enforcement.

    Legal Proceedings https://www.tianyancha.com/slawsuit/2949196401-9839

    Complete Company Profile https://www.tianyancha.com/company/2329499515


  35. You’re welcome SeaofSand, glad it helped. I do read you other posts elsewhere.
    Here are some additional observations and some thoughts:

    1. It’s possible the Insiders just needed to sell for reasons unknown.
    2. Looking at previous 10K, the insiders had very uniform ownership under 10%.
    3. Given the Company’s structure it’s likely that insiders are located offshore and at least in my mind, knowing above, I treat them as a single entity including CEO.
    4. I think having this <10% ownership each allows them flexibility without need to report to SEC.
    5. "The 2nd Stage Selling" is very peculiar indeed and makes little sense but the valuation here is also very speculative and can probably vary by one order of magnitude and yet could be legitimately rationalized at both extremes. This presents opportunity. So could they make money by selling 30M shares at ave of $1 and than buying back at ave of say $0.30? I think so. Is it legal? Probably. Were they setup this way to be able to do this? Likely.
    6. If the plan here is to re-buy cheaper, it's probably best case scenario for new retail shareholders but timing entries here may be difficult.


    1. @YK thank you for this debate.

      Since Coleman is still employed it seems, his and the others selling hasn’t created a big insider fight yet. Hence it is possible that they are all acting together somehow – maybe. This would be illegal though: Collusion 😉

      Coleman’s avg selling price was $0.8868/sh for his relative small 1.75M ‘dump’, the other ~25M shares sold average is unknown.
      It would be very hard to benefit from arbitrage this low IMHO, the liquidity of shares would run out. The latter is something I am looking for – less supply due to bought and held shares (accumulation). So far this seemingly didn’t happen to the new 40M float.

      The only arbitrage to profit would be to sell above $5 and buyback on the very lows, if they would have participate here via short selling .. – a very adventurous scenario.

      Regarding the high speculative situation, the land use rights (LORs) and leases are supposed to be there and the LORs less total liabilities supposed to be over $2/sh minimum. But the China Construction Bank $43M loan judgement with increased interest rate also seems to be hanging over the company, it needs to be paid. (See above Legal Proceedings)
      In the end, if CEO Liu has YRIV’s back as stated with the refutation and also holding the $120M liabilities from the judgement – there is probably value. Otherwise it all would look quite dark, as the LORs and leases would be ‘taken away’ to pay the debt? We need to take their word here from the refutation and 10-K filing (no $120M extra liabilities).

      However, the ‘insider’ selling of the original owner still doesn’t add up here, only if they colluded with a short attack before the price dived below $3 or so. As we cannot just assume such questionable trades, we might also simply assume that they just sold ~50% of their stake to reduce the risk in this ‘speculation’. Problem here is, they all should know perfectly what is going on and about the value, so this is little speculation for them actually.

      Looks like we do not see a good resolution of this puzzle yet :-/ (edited)


  36. Fri 3/22 closing could be 30 sessions < $1 bid, qualifying for delisting notification (1st 180d grace period).
    Seems like the 2nd stage sellers after 1/28 had a plan which got disclosed on 3/1 w/ 10-K filing (then the plunge from $1 again).
    Quite a thriller here ..


  37. Just saw the heads up of this ‘buyins’ thingy .. https://www.globenewswire.com/news-release/2018/03/19/1442162/0/en/Yangtze-River-Port-and-Logistics-Limited-Retains-BUYINS-NET-to-Surveil-Short-Sellers-and-Market-Makers.html

    Intraday short blur has no meaning, IMHO http://otcsecrets.com/the-truth-about-naked-short-selling/
    So retaining ‘buyins’ ‘service’ is weak and almost desperate, we saw even CYDY trying this stunt 😉

    Funny, that ‘news’ was from last year: March 19, 2018 10:30 ET, so ignore 😉


  38. From the market value of tens of billions to the ridiculous project, what happened to the Wuhan company listed on the US stock market?

    A much more detailed article from 2019-03-19, also reflecting company’s refutation from 2018-12-13 and 10-K as filed on 2019-03-01.
    It very well describes correctly (IMHO):
    – The lawsuit judgements (see https://translate.google.com/translate?hl=en&sl=zh-CN&u=https://www.tianyancha.com/slawsuit/2949196401-9839&prev=search) and
    – the company’s history.

    Now the real issue here is (1) the 1.2M square meter lease and ofc (2) the LORs contingent on the debt payment by company.

    (1) the 1.2M square meter lease
    The new article’s statement that the lease has never been issued to YRIV as supported by the village would be quite damaging if true.
    This reinforces the original short claims and contradicts YRIV’s refutation.
    Maybe they asked the village the wrong questions? Maybe it was leased by pre-merger company, so the names differ?
    Now that would be quite an adventurous move by the journalist or village, so we probably can’t take this to rescue the situation.
    This really needs a bullet proof resolution.

    (2) the LORs contingent on the debt payment by company
    As company seems to have gotten the LORs for the loan guarantee of previous owner’s debt,
    company would need to actually pay down all of the debts to retain the LORs?
    Now if the original previous debt owner pays down the their original debt as pledged and also mentioned in YRIV’s refutation, wouldn’t YRIV’s LORs going back and be lost?

    Bottom line, yes – YRIV’s assets are of course being frozen by the courts (claimed as collateral) as long the debt hasn’t being paid in full.
    Since company has no means to continue the land development ‘these days’ anyways, all what matters is:
    – Can YRIV retain the LORs and are the leases for real?
    – How will the debt be resolved (Partially selling land?)

    What is the real LOR land value?

    The value of the calculation of 515,600 square meters of land, valued to nearly 600 million US dollars. From a geographical perspective, the project is not in the commercial zone of the Yangluo Development Zone. According to the land transfer network released on January 8 this year, a 70-year-old “Wuhan Xinzhou Yangluo 667 mu (about 444,200 square meters) commercial and residential land” sales information shows that its offer is 910 million yuan.

    RMB 910M = $127.4M @ RMBUSD 0.14 for 444,200 square-meters -> $286.81/sqm
    This would just render the 515,600 sqm worth $148M at best.

    And the story continues being complicated and fascinating…

    Adding a quote to the point from ‘Luckierthangood’

    fact remains would YRIV want to go through discovery via this suit they brought? NO if crooks


  39. Hi SeaofSand – thanks for all of the info, this is an interesting story. Do you know if there is a date scheduled for the next court appearance?


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