Recently, the highly watched dispute over the truth of Zoomlion's "fraud scandal" has escalated once again. On the afternoon of the 15th, Zoomlion Vice President Sun Changjun explicitly told the China News Service Finance Channel that the company will sue the relevant enterprises. Judging from the announcement subsequently disclosed by Zoomlion and a series of recent statements by senior Zoomlion executives, the target is directly aimed at Sany Heavy Industry, and a "litigation war" stemming from years of mutual grievances between the two sides is about to break out.

　　Zoomlion Fights Back Against "Fraud Scandal," Possibly Triggering "Litigation War"

　　"There will definitely be a lawsuit. As for the specific targets, please pay attention to recent announcements." Sun Changjun's remarks to the China News Service Finance Channel signal that the "fraud scandal" has escalated once again, and a "litigation war" is about to begin.

　　Regarding the real-name report by someone accusing Zoomlion of "financial fraud," Sun Changjun said at a small-scale teleconference held on the afternoon of the 15th that Zoomlion accepts the report itself, but opposes the use of the name of "reporting" to manipulate public opinion through the media. Zoomlion will issue a series of announcements this week and will also initiate relevant legal procedures.

　　Sun Changjun pointed out that in addition to welcoming regulatory authorities and departments at all levels to strictly investigate whether Zoomlion has committed financial fraud, he also hopes that regulatory authorities and departments at all levels will also investigate other rumors and doubts in the market. "Zoomlion will use legal weapons to fight this litigation war. We must have sufficient evidence and will not do something that achieves nothing."

　　As of the time the China News Service Finance Channel published this report, the verified Weibo account of Sany Heavy Industry President Xiang Wenbo, who is usually sensitive and quick to "react," had shown no activity, and the reporter had not yet interviewed other senior executives of Sany Heavy Industry.

　　Zoomlion's "Litigation War" Takes Aim Directly at Sany Heavy Industry

　　Shortly after the teleconference ended, Zoomlion disclosed the "Zoomlion: H-Share Announcement." Although the announcement did not contain the litigation content mentioned in the earlier teleconference, the target of the "litigation war" already appears to point to its competitor Sany Heavy Industry.

　　The announcement stated that after multiple online media published two articles in November 2012 titled "Sany's Bitter Farewell to Changsha: Liang Wengen's Inner Monologue" (hereinafter referred to as "Monologue") and "Spy Gate Incident Becomes the Trigger for Headquarters Relocation: The True Hidden Story Behind Sany Heavy Industry's 'Capital Relocation'," the company believes it is time to take active action to end an industry competitor's endless malicious false accusations against the company.

　　Just before the teleconference was held and the announcement was issued, on the morning of the 15th, Zoomlion posted a Weibo message through an account verified as "Gao Hui, Assistant to the Chairman of Zoomlion Heavy Industry Science & Technology Co., Ltd.," stating that judging from the background, source, release, and subsequent development of the news article "Zoomlion's Persistent Abnormal Marketing Amid 513 Million Yuan in Annual Advertising Expenses," several senior executives of Sany Heavy Industry are highly suspected of planning and manipulating this defamatory news event.

　　When Zoomlion previously responded to the real-name report on financial fraud, it also pointed out that "Zoomlion's financial reports are true and reliable. This reporting phenomenon is not an isolated incident, but an organized, planned, all-round attempt to frame and suppress Zoomlion since the 'Monologue' in November last year," and stated that "Zoomlion will reserve the right to defend its rights in accordance with the law."

　　Zoomlion Falls into "Fraud Scandal" Vortex for the Fourth Time, Share Price Halved

　　According to a report by Yangcheng Evening News on the 10th, a market participant tipped off that he had filed a real-name report with the Hong Kong Stock Exchange and the mainland securities regulators accusing Zoomlion of "financial fraud," claiming that Zoomlion is "suspected of manipulating profits and suspected of false statements and misleading investors, two major violations of laws and regulations."

　　At a regular press conference held on the 12th, the China Securities Regulatory Commission said it had received the reporting materials on Zoomlion and was handling them in accordance with relevant working procedures. Previously, on June 21, the Hong Kong Securities and Futures Commission had conducted a preliminary review of the report, and the Hong Kong Stock Exchange had also received the reporting materials and said it needed to further understand the relevant matters before considering whether regulatory action was needed.

　　This is already the fourth time this year that Zoomlion has fallen into the "financial fraud" vortex. The successive reports of financial fraud have dealt a huge blow to Zoomlion, with the company's share price halved and investors suffering heavy losses. On the 10th, affected by the news that Zoomlion had been reported by real name for financial fraud, its H-share price fell by more than 5% at one point, hitting a new low since listing, and closed down 1.97% at HK$4.97. Its A-share price, after hitting a new high for the year of 10.44 yuan in February this year, fell for four consecutive months, with a maximum decline of 52%, and more than 34 billion yuan in market value has evaporated.

　　In response, Zoomlion Vice President Sun Changjun told the China News Service Finance Channel that the stock decline from last year to now has been affected on the one hand by the overall economic situation and on the other hand is closely related to the continuous smearing behavior released in the market. "If we continue to be tolerant at this time and do not resort to legal channels, minority shareholders will also hold us accountable."