Zhonghe Co., Ltd. cancelled the acquisition of Sichuan State Lithium Material Co., Ltd. from a group of sellers.
November 08, 2016
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Zhonghe Co., Ltd. (SZSE:002070) agreed to acquire Sichuan State Lithium Material Co., Ltd. from a group of sellers in stock on November 9, 2015. The sellers include Chengdu Yashang Investment Co. Ltd., Sichuan Yahua Industrial Group Co., Ltd. (SZSE:002497), Hangzhou Ronggao Equity Investment Co., Ltd., Tibet Rongde Investment Management Co., Ltd., Shanghai Chenxiang Investment Center (Limited Partnership), Chengdu Yigao Growth Venture Capital Co., Ltd., Sichuan Hidili Industry Co., Ltd., Zhang Jingyun, Lin Zhongqun, Chen Siwei, Li Hong, Tian Shu'ao, Huang Jianbin, Li Liang, Yang Chunhui and Lan Ying. In a related transaction, Zhonghe Co., Ltd. agreed to acquire Blossom Lithium Industrial Ltd. from Sichuan Yahua Industrial Group Co., Ltd. on November 9, 2015. Zhonghe will issues shares at CNY 11.53 per share to acquire Sichuan State Lithium Material and Blossom Lithium Industrial. Sichuan Yahua Industrial Group will receive 33.13 million shares as consideration for its 37.25% stake in Sichuan State Lithium Material and 100% stake in Blossom Lithium Industrial. Zhonghe will issue 43.83 million shares to acquire the remaining 62.75% stake in Sichuan State Lithium Material. As on May 23, 2016, the deal terms were revised and Zhonghe Co Ltd will now acquire 98.76% stake in Sichuan State Lithium Material Co., Ltd via share issue. Zhonghe Co revised the combined acquisition price to CNY 877.3 million instead of CNY 1 billion.
As of December 31, 2014, Sichuan State had total assets of CNY 559.61 million, shareholder's equity of CNY 423.87 million, revenue of CNY 58.94 million and net loss of CNY 35.07 million. The deal is subject to second approval of Board of Directors of Zhonghe, shareholders of Zhonghe and approval of CSRC. The deal was approved by Board of Directors of Zhonghe on November 19, 2015. The revised terms were approved by the Board of Directors of Zhonghe on May 19, 2016. New Times Securities Co., Ltd. acted as financial advisor for Zhonghe Co., Ltd.
Zhonghe Co., Ltd. (SZSE:002070) cancelled the acquisition of Sichuan State Lithium Material Co., Ltd. from a group of sellers on November 9, 2016.
Sichuan Yahua Industrial Group Co., Ltd. is a China-based company principally engaged in the manufacture and sales of civil explosives. . The Companyâs main products include industrial explosives, industrial detonators, industrial cords, industrial detonators, customized civil explosive products and others. The Companyâs products are mainly applied in mining, hydropower, transportation construction, urban renewal, geological exploration and national defense industries. Through its subsidiaries, the Company is also engaged in the manufacture and sales of lithium carbonate, lithium hydroxide and other lithium salt products. The Company distributes its products in domestic market and to overseas markets.
SICHUAN YAHUA INDUSTRIAL GROUP CO., LTD. 
