Taiwan Cement, Chia Hsin Cement to Benefit From Merger

Taiwan Cement, Chia Hsin Cement to Benefit From Merger
Published: 02 October 2007

Taiwan Cement Corporation and Chia Hsin Cement Corporation today (Oct. 2)
will complete merging their subsidiaries—Taiwan Cement International and
Chia Hsin China, both listed on the Hong Kong Stock Exchange.

A foreign institutional investor said Chia Hsin Cement will become the
largest beneficiary after the merger and Taiwan Cement will see better
deployment integration in the mainland marketplace.

Chia Hsin said its Jingyang and Union cement plants located in the mainland
each scored over Yuan 20m in earnings in the first half of this
year. Thanks to the price hike in cement in the mainland market in
September, these two plants will see earnings in the second half of this
year surpass that of the first.

It is estimated Jingyang and Union plants will be able to post 80 million
and 60 million renminbi this year, respectively if the price quoted for
cement increases Yuan 20  to reach between Yuan 260 and 280 per tonne
In the main markets.

Due to the price hike in cement in southern China region, Taiwan Cement will
see earnings contribution from the mainland amount to Yuan 150 million
this year. The company noted its Yingte plant in Guangdong province has
begun making profits since the first quarter of this year.

Because of the merger of Chia Hsin China into Taiwan Cement International,
Chia Hsin Cement will hold 29% stake in Taiwan Cement International.
Accordingly, the merger will help Chia Hsin Cement directly share the
operating effects of Taiwan Cement’s Yingte plant.