China National Materials Co Ltd (Sinoma), the world’s largest provider of cement-producing equipment, on Monday announced that it has signed an agreement to buy 55m new shares of Gansu Qilianshan Cement Co for RMB 9.11 (US$1.33) apiece.
After the transaction, Sinoma will hold an 11.58 per cent stake in Gansu Qilanshan and will be the latter’s second largest shareholder, said the company in a statement filed with the Hong Kong Stock Exchange.
Pursuant to the agreement, Sinoma will commit to a 12-month lock-up period for the new shares.
The stake purchase is part of Sinoma’s effort to become the largest cement producer in northern China and will further enhance the firm’s profitability, said the company.
Sinoma plans to spend RMB1bn purchasing new shares of Shenzhen-listed Xinjiang Tianshan Cement Co Ltd to raise its shareholding to 44.36 per cent from the current 36.28 per cent, according to an earlier report from China Knowledge.