Diversified China focused investment company Prosperity Minerals Holdings updated investors on changes in its shareholdings in two cement companies in China.
Late last week, Prosperity’s 33.06 per cent owned Shanghai quoted cement manufacturer ACC announced it was issuing 40 million shares to pay off its debts and fund its construction projects.
Prosperity will not participate in the fundraising, which means that its shareholding will decline to 28.37 per cent, enough to keep it the largest stakeholder in the company.
The projects planned by ACC include the construction of a residual heat electricity generation unit for the second new clinker production line, a private river port and a commercial concrete mixing unit.
The fundraising remains subject to approval by ACC’s shareholders and Chinese regulators.
Prosperity’s other part owned cement company, Liaoning Changqing, has also decided to enlarge its share capital, which will result in the dilution of Prosperity’s shareholding from 25 per cent to 16.11 per cent.
TCC, which currently owns 75 per cent of Liaoning Changqing has taken up all of the new shares and decided to change Liaoning’s name to TCC Liaoyang Cement Company.
Last month, Prosperity reported that its profits jumped 369 percent to US$192.1m in the year to 31 March compared to the previous year.
The group has gone through a number of significant changes in the past few years after it sold off the majority of its cement businesses for US$487m in April 2010, and diversified its strategy to focus on iron ore trading and Chinese real estate.