(Yicai) May 8 -- 360 Security Technology said it will firmly pursue legal action over what it says were unfounded and fabricated rumors about the Chinese cybersecurity behemoth, also known as Qihoo 360, experiencing financial difficulties.

360 Security had about CNY26.9 billion (USD3.7 billion) in cash and cash equivalents as of March 31 and has no financial problems, the Beijing-based company said on Weibo yesterday.

According to recent rumors on Chinese social media, when 360 Security was delisted from the US market and returned to the Shanghai Stock Exchange, the CNY20 billion debt of its founder Zhou Hongyi had matured, resulting in the firm facing liquidity risk due to all of his equity being under pledge.

360 Security was removed from the New York Stock Exchange in July 2016 and smoothly returned to the SSE in February 2018. To complete the privatization and acquisition, its largest shareholder Tianjin Qixin Zhicheng Technology got a USD3 billion loan from China Merchants Bank using its stock in 360 Security as collateral.

The loan principal and interest were fully repaid as of June 30 last year, and all the shares pledged as collateral were released a month later.

360 Security [SHA: 601360] fell 4.5 percent to CNY9 (USD1.25) a share as of lunch break today, after dropping by as much as 5.1 percent in the morning trading session.

Editor: Martin Kadiev