Wanhua Chemical announces acquisition of equity interests in Tonghua Group

Wanhua Chemical Group Co., Ltd. announced on November 8 that on November 7, Wanhua Chemical and Tongling State-owned Capital Operation Holding Group Co., Ltd., Anhui Chuanggu New Materials Co., Ltd., Anhui Heyuan Equity Investment Co., Ltd., Anhui Province Investment Group Holdings Co., Ltd. and the target company Tonghua Group signed the "Equity Change Framework Agreement" and planned to acquire 51% of the equity in the chemical business of Tonghua Group and 34% of the equity in the non-chemical business.

The announcement shows that all parties agreed that the assessment base date is October 31, 2023, and that the upper limit of the relevant equity transactions involved in this transaction shall not exceed RMB 6 billion, and shall be based on the assessed value.

The announcement shows that after 30 years of construction and development, Tonghua Group has now become a diversified group enterprise with leading industries such as chemical mining, sulfur and phosphorus chemicals, fine chemicals, new materials, trade logistics, real estate development, etc. It is a It is an important domestic sulfur and phosphorus chemical industry base and new pigment industry base. It controls two listed companies, "Liuguo Chemical" and "Annada". The production and sales volume of its leading products, including high-efficiency phosphate compound fertilizer, titanium dioxide, phthalic anhydride, pyrite, and battery material ferric phosphate, rank among the top among domestic peers.

After the transaction is completed, Wanhua Chemical will become the controlling shareholder of Tonghua Group's chemical business, and the actual controllers of Tonghua Group's chemical business and its subsidiaries Anhui Liuguo Chemical Co., Ltd. and Anhui Annada Titanium Co., Ltd. will change It is the State-owned Assets Supervision and Administration Commission of Yantai Municipal People's Government.

Wanhua Chemical stated that after this reorganization, it will further improve the upstream raw material supply chain and enhance the core competitiveness of the battery business; it will create complementary and synergistic effects between its existing coatings business and the titanium dioxide business of the Copper Chemical Group; Wanhua Chemical will Chemical Group holds a 34% stake in the mining business to further safeguard phosphate rock resources, solve bottlenecks for future phosphorus resource needs, and enhance product competitiveness.

For Tonghua Group, the coal chemical operation experience and technical advantages provided by Wanhua Chemical can optimize Tonghua Group’s coal gasification equipment and enhance the market competitiveness of the group’s existing products.