It is planned to acquire two affiliated enterprises of RMB 1.4 billion

In the evening of November 15, Lubei chemical industry announced that the company plans to purchase all the equity of Jinhai titanium industry and Xianghai titanium industry at a total price of 1.4 billion yuan, and at the same time, it plans to raise supporting funds of no more than 549 million yuan through non-public issuance of shares, and all the raised funds are used to pay the consideration of this transaction and the intermediary fees related to this transaction. The announcement shows that the counterparties Lubei group and Jinjiang Group are all related parties of the company. Among them, Lubei group is the controlling shareholder of the company, and Jinjiang Group holds 35.6% equity of Lubei group. The acquisition constitutes a major asset restructuring, but does not constitute a restructuring listing. According to the plan, the transaction price of 100% shareholders' equity of Jinhai titanium industry is tentatively determined to be 1.38 billion yuan, and the paid in capital of Xianghai titanium industry is 20 million yuan.

After preliminary negotiation, the transaction price of 100% shareholders' equity of Xianghai titanium industry is tentatively determined to be 20 million yuan. From the perspective of transaction plan, the corresponding value of 66% equity of Jinhai titanium industry held by Lubei group is 911 million yuan, and that of 34% equity of Jinhai titanium industry held by Jinjiang Group is 469 million yuan. Lubei chemical intends to pay 50% shares and 50% cash to Lubei group and 20% shares and 80% cash to Jinjiang Group. The corresponding value of 100% equity of Xianghai titanium industry held by Lubei group is 20 million yuan, all of which are paid by the listed company in cash. According to the announcement, Jinhai titanium industry has a sulfuric acid titanium dioxide production line with an annual output of more than 100000 tons, and another sulfuric acid titanium dioxide production line with an annual output of 100000 tons is under construction.

In 2017, 2018 and the first three quarters of 2019, the operating revenue of Jinhai titanium industry was 1.38 billion yuan, 1.654 billion yuan and 1.149 billion yuan respectively, and the net profit was 83.9265 million yuan, 96.066 million yuan and 63.5083 million yuan respectively. Xianghai titanium industry is preparing to build a titanium dioxide project with an annual output of 60000 tons. Titanium dioxide produced by chlorination has the advantages of short process, high product quality, easy to realize automation, high comprehensive utilization and less pollution. It is a national encouraged project. At present, Lubei chemical is mainly engaged in chemical fertilizer, cement, salt and methane chloride business. Through this transaction, Jinhai titanium industry and Xianghai titanium industry will become wholly-owned subsidiaries of the company. The main business of the company will increase titanium dioxide business, which will help to play the synergistic effect of the chemical industry and make full use of the circular economy. Through the layout of titanium dioxide industry, the company will further enhance its core competitiveness and enhance its sustainable profitability.