Yanzhou Coal announced on October 1st that the company intends to acquire relevant assets of the controlling shareholder Yankuang Group for 18.355 billion yuan in cash. Including 49.315% equity of Future Energy, 100% equity of Fine Chemicals, 100% equity of Lunan Chemical, 100% equity of Chemical Equipment, 100% equity of Supply and Marketing Company, 99% equity of Jisan Electric Power and information center and other related assets.
According to industry insiders, this acquisition is the largest cash acquisition transaction in the domestic coal industry in recent years. It reflects Yankuang Group’s acceleration of securitization of related assets of its main coal business. After the completion of the acquisition, the assets of Yankuang Group The securitization rate will reach about 90%.
From the perspective of the composition of the acquired assets, Future Energy’s 49.315% equity is valued at 10.818 billion yuan, and Lunan Chemical’s 100% equity is valued at 6.187 billion yuan. Both companies are mainly engaged in coal chemical business. According to the disclosed data, Future Energy's operating income and net profit in 2019 were 8.752 billion yuan and 2.245 billion yuan, respectively. Lunan Chemical's operating income and net profit in 2019 were 6.31 billion yuan and 389 million yuan.
Specifically, the main businesses of Future Energy and Lunan Chemical are coal chemical businesses. The future energy business scope includes the research and development of chemical products and oil products; Lunan Chemical's main business scope includes the development, production and sales of acetic acid, ethyl acetate, methyl acetate and other chemical products. In terms of financial data, Future Energy and Lunan Chemical achieved operating revenues of 8.752 billion yuan and 6.31 billion yuan respectively in 2019, and net profits of 2.245 billion yuan and 388 million yuan.
The company stated that through this transaction, the company can realize the integration of the Yankuang Group's coal chemical industry business, extend the industrial chain, optimize the company's main business, enhance the company's profitability and anti-risk ability, and enhance the company's value and shareholder returns. After the transaction is completed, the target company and target assets will be added to the scope of the company’s consolidated statement, which can increase the company’s total assets, increase the company’s operating income, and exert synergy and scale effects; by extending the industrial chain, it can improve overall operating performance and profitability, and enhance The company’s ability to sustainably develop and resist risks helps protect the interests of the company’s shareholders. In addition, after the completion of the acquisition, related transactions between the company and Yankuang Group will also be reduced, which will help improve the company's standard operation level.
In recent years, Yanzhou Coal has accelerated the integration of main business assets and the divestiture of non-main business assets. On March 27 this year, the company's board of directors passed a resolution to sell 100% of the shares of Yancoal International Trading Company and Yancoal Singapore's two wholly-owned grandson companies. The two wholly-owned Sun companies are engaged in non-coal trading business, which has a low degree of relevance to the main business, but accounts for a large scale of company revenue. According to the data disclosed by the company at the time, Yancoal International Trading Company's revenue in 2018 was 22.85 billion yuan, net profit was 88 million yuan, and the net assets at the end of 2018 were 60 million yuan; Yancoal Singapore's 2018 revenue was 29.17 billion yuan and net profit was 1.06 million yuan. At the end of 2018, the net assets were 70 million yuan. The total revenue of the two companies in 2018 was 52.02 billion yuan, accounting for 54% of the company's other business (mainly trading business) revenue.
Source: Chemical Network
