On June 10th, Lubei Chemical (600727) injected the controlling shareholder titanium dioxide assets with a final result. According to company announcements, the 25th meeting of the M&A and Restructuring Review Committee of the Listed Companies of the China Securities Regulatory Commission in 2020 was held on the morning of the 10th. It issued shares to Lubei Chemical and paid cash to purchase assets and raise supporting funds and related transactions (hereinafter referred to as "this reorganization" ") was reviewed and the reorganization was approved unconditionally. The company's stock resumed trading since the market opened on the 11th.
Acquired two affiliated companies, Jinhai Titanium and Xianghai Titanium
Lubei Chemical's original main fertilizer, after tasting the sweetness due to the extension of mergers and acquisitions, Lubei Chemical once again started extensional expansion. This reorganization has been operating for a long time, and related matters have been disclosed in November 2019. The company plans to acquire 100% equity of Shandong Jinhai Titanium Resources Technology Co., Ltd. and 100% equity of Shandong Xianghai Titanium Resources Technology Co., Ltd. at a price of 1.4 billion yuan. It will become one of the few large-scale titanium dioxide production enterprises with both sulfuric acid method and chlorination method production technology, to achieve a comprehensive layout in the titanium dioxide industry.
At the same time, it is planned to raise supporting funds of not more than 549 million yuan through non-public offering of shares, all of the funds raised will be used to pay for the consideration of this transaction and the intermediary fees related to this transaction.
The controlling shareholder of Lubei Chemical is Lubei Group. Lubei Group holds 100% of Xianghai Titanium, 66% of Jinhai Titanium, and Jinjiang Group holds the remaining 34% of Jinhai Titanium.
Therefore, this reorganization of Lubei Chemicals is mainly to inject the group's titanium dioxide assets into listed companies. According to the transaction report, the listed company plans to issue shares to Lubei Group and pay cash to acquire 66% of its equity in Jinhai Titanium, and to issue shares to Jinjiang Group and pay cash to acquire 34% of its equity in Jinhai Titanium.
The waste of the titanium dioxide industry will be reused by listed companies, which will reduce related transactions with the controlling party. The assets of the Lubei Group’s titanium industry sector will be injected into the listed companies as a whole. The overall listing laid the foundation.
Industry scale advantage is obvious
Compared with the expansion of enterprise scale through mergers and acquisitions, the injection of titanium dioxide assets makes Lubei Chemical's future performance growth more imaginable.
According to the announcement, Jinhai Titanium, the subject of this transaction, has a sulphuric acid titanium dioxide production facility with an annual output of over 100,000 tons, and another sulphuric acid titanium dioxide production line with an annual output of 100,000 tons is under construction; at the same time, Xianghai Titanium The industry is implementing the construction project of chlorination method titanium dioxide with an annual output of 60,000 tons.
Judging from the progress of the project, Jinhai Titanium's annual production capacity of 100,000 tons of sulfuric acid titanium dioxide production line is planned to be built for 24 months, and it is expected to be completed and put into production by the end of 2021.
Xianghai Titanium's annual production capacity of 60,000 tons of chlorinated titanium dioxide production line is planned to have a construction period of 24 months, and it is planned to be put into production at the end of 2021.
According to the data of the titanium dioxide branch center of the National Chemical Industry Productivity Promotion Center, as of the end of 2019, there are 41 full-scale large-scale titanium dioxide enterprises that maintain normal production throughout the country, and the effective production capacity of the entire industry is 3.8 million tons/year, of which the annual production capacity reaches 100,000 There are only 11 production enterprises with tons and above. Lubei Chemical's future annual production capacity of titanium dioxide can reach 260,000 tons. At that time, Lubei Chemical's titanium dioxide industrial chain device will rank first in the country!
Judging from the development trend of China's titanium dioxide industry, with the increasingly strict environmental protection policies and potential industry restructuring and other factors, the concentration of titanium dioxide industry has further increased, and enterprises with larger production capacity and scale will have stronger competitiveness and Broader market demand.
Synergy with existing industries
After the completion of this transaction, Lubei Chemical's main business will increase the titanium dioxide business on the basis of the original fertilizer business, cement business, salt business and methane chloride business. From a strategic perspective, the company will continue to implement a diversified development strategy in the future and maintain the market position and competitive advantages of the fertilizer business, cement business, salt business, methane chloride business, and titanium dioxide business in their respective fields.
The acquisition will further enrich the circular economy model that Lubei Chemical has been working on, and the business synergy of "listed company-Xianghai Titanium Industry-Jinhai Titanium Industry" is significant.
Lubei Chemical Industry has formed a co-production plant for producing sulfuric acid and co-production of phosphogypsum by-product from ammonium phosphate with technical advantages and its own characteristics. The company also has a technology application device for the utilization of titanium dioxide waste acid and alkylated waste sulfuric acid in petrochemical plants, which not only improves the economic benefit of the co-production device, but also realizes the resource utilization of waste sulfuric acid, while avoiding waste acid Secondary pollution reduces the cost of waste acid treatment.
The titanium dioxide business acquired by the company can be integrated into the company's circular economy circle. The waste sulfuric acid and titanium gypsum are produced during the production of titanium dioxide in Jinhai Titanium Industry. The waste sulfuric acid can be used in the extraction process of the Lubei Chemical Co-production Plant, and the remaining part can be used to produce water purifier products; titanium gypsum can be used in the Lubei Chemical Cogeneration Plant In the acid production process of gypsum in the process, the sulfuric acid produced can be reused in the acid hydrolysis process of the titanium dioxide production of Jinhai Titanium Industry, so as to realize the recycling of resources. The titanium-rich material produced after the completion of the new production line of Jinhai Titanium Industry can be used as a raw material for the production of chlorination titanium dioxide in Xianghai Titanium Industry, and the waste residue generated in the production process of titanium dioxide in Xianghai Titanium Industry can all be used for the joint production of Lubei Chemical Industry The device produces cement.
Source: Mobei Public Account
