Direct Manage Investments Ltd plans to spend CNY1.91bn to acquire a 10 per cent stake in Tangshan Jidong Cement Co Ltd, the biggest cement producer in North China, according to a statement today released by the Shenzhen-listed firm.
Direct Manage Investments will buy 134 million shares issued by Tangshan Jidong Cement for CNY14.21 apiece, and the latter firm will use the fund to replenish working capital. After the share sales, Tangshan Jidong Cement’s asset/debt ratio will decline 4.95 to 63 per cent.
In June, Tangshan Jidong Cement negotiated with Shaanxi QinLing Cement (Group) Co Ltd for a restructuring project but failed. Reportedly, Tangshan Jidong Cement and parent Jidong Cement Group will invest a total of CNY250m in a concrete subsidiary to expand its output, and the subsidiary’s registered capital will swell from CNY231m to CNY481m.