Huayi Group plans to inject its three chemical businesses into listed companies

Shanghai's state-owned capital reform has a new action.
China Paint Network
News: April 2, Huayi Group held a note meeting, formally on the Group's core assets into listed companies plan to interpret - Huayi Group plans to its most competitive "fine chemical, energy chemical, chemical services" three businesses into listed companies.
Huayi's listed company, Double Money, disclosed its restructuring plan on the evening of March 23rd, proposing to acquire the assets of seven companies, including Energy, New Materials, Refine, Investment and Tianyuan, for 11.647 billion yuan. At the same time, Double Money shares will also raise no more than 3.733 billion yuan as supporting funds.
21st century economic reporters from the participants learned that at the meeting on the 2nd, Huayi Group Finance Director Chang Qing frankly said that the group's two-money shares, San aifu and chlor-alkali chemical three listed companies in the past "not a big move", this choice to inject core assets mainly because of increased financing pressure in recent years. Through the listing of core assets, Huayi Group's assets not only achieve value-added, but also further geographically smooth the property rights relationship.
in Huayi Group, the companies injected by the plan are among the most competitive business sectors they are currently in. Upon completion of the transaction, the listed companies will further integrate their energy and chemical, fine chemical, green tire and chemical services businesses, and gradually transition from manufacturing to system solution providers.
pressure to accelerate the listing of
after the suspension of trading in December 2014, Double Money shares finally in late March to send a re-listing ceremony.
restructuring plan released on the evening of March 23rd showed that Shuang qian shares would issue 931 million shares to the majority shareholder Huayi Group at a price of 12.51 yuan per share, and acquire 100% of the latter's energy company, New Materials Company1 00% equity, 100% equity of refined company, 100% equity of investment company, 100% equity of Tianyuan company, 55% equity of information company and 30% equity of finance company, the overall price is 11.647 billion yuan.
At the same time, Shuang qian shares will also raise no more than 3,733 million yuan from 10 specific investors for the Shanghai Chemical District 320,000 tons / year acrylic and ester project, 1200 tons / year catalyst project, Huayi
coatings
capital increase project, Kunshan Bao salt capital increase project, finance' company capital increase project and supplementary working capital.
reporters understand that since the suspension of double-money shares in December last year, Huayi Group set up a total of 7 working groups, 700 people of the team to prepare for asset restructuring work. The restructuring plan was not announced until late March because it was considered to simultaneously grasp the "wind" of state-owned capital reform policies, the rising stock market and the cycle of the chemical industry.
huayi Group to further inject assets into listed companies, the fundamental motivation comes from increasing financing pressure. In Changqing's words, the high cost of financing somehow "forces companies to go public".
, although Huayi Group's debt ratio is not high, about 55%, but through the bank channels to raise about 20 billion, financing costs are high. To open up financing channels, Huayi Group last year issued $350m of five-year overseas bonds in Hong Kong, but its financial costs alone are more than a billion, and this indirect financing is not sustainable.
past few years, Huayi Group's business development is mainly supported by its own funds. Huayi said it has invested more than $20 billion in the past five years, and needs about $5 billion a year for development. In addition, as an old state-owned enterprises, Huayi Group in the placement of employees and other aspects of the expenditure of up to more than 3 billion yuan.
's shares have risen about 70
per cent in less than ten trading days since the restructuring plan was announced.
According to Changqing revealed that in fact, the group below a part of the assets are not included in the injection, because there are land, real estate problems or share ownership problems, but also part of the future relocation, in addition to poor economic efficiency, asset yield is relatively low and other factors have not been considered for loading.
According to Huayi Group, this injection of "energy chemical industry, fine chemical industry, chemical services" are Huayi Group's most competitive business sector, its main products are Huayi Group has been operating for many years and has brand barriers to the "fist" products.
Energy Sector Shanghai Huayi Energy Chemical Co., Ltd. (i.e., Energy Chemical Co., Ltd.) was merged last year by Shanghai Coking Plant and Wu Wei Chemical, last year's total sales revenue of 12 billion yuan, profits reached 1 billion yuan, its annual production capacity of methanol and acetic acid reached 1.6 million tons and 1.25 million tons, respectively.
fine chemical sector injection is Shanghai Huayi Fine Chemical Co., Ltd. and Shanghai Huayi New Materials Co., Ltd., in which the refining company in coatings, pigments and other aspects of the industry leader, the latter is still in the project construction phase.
chemical services sector is injected by Shanghai Huayi Group Investment Co., Ltd. (Investment Company), Shanghai Tianyuan (Group) Co., Ltd. (Tianyuan Company), Shanghai Huayi Information Technology Co., Ltd. (Information Company) and Shanghai Huayi Group Finance Co., Ltd. (Finance' Co., Ltd.). The four companies will provide diversified and specialized services to the production business sector by building platforms such as logistics, trade, information, finance and e-commerce, promoting the competitiveness of the main industry and offsetting the negative impact of commodity price fluctuations.
completion of the above-mentioned acquisition, Shuang qian shares became Huayi Group's core business listing platform, from the original green tire business expanded to four business sectors. In addition, the aforementioned investment companies will explore potential core business project opportunities through investment mergers and acquisitions in the future, selectively cultivating 1-2 core businesses.
After the completion of the transaction, net income attributable to the owners of the parent company increased from RMB1.27 billion to RMB3.4 billion, an increase of 271.79 percent, and earnings per share increased from RMB0.38 per share to RMB0.70 per share, an increase of 84.21 percent.
Huayi Group said the seven companies to be acquired had book assets of $8.2 billion, and that the value of state-owned assets had increased by 40 per cent from the $11.6 billion in assets assessed for the listing. After the completion of the transaction, Huayi Group's stake in listed companies will rise from 65.66 per cent to 83.22 per cent, further strengthening its control over state-owned assets.