Tongli Cement acquisition, China

Henan Tongli Cement plans to acquire 100 per cent of Yima Coal Industry (Group) Cement Co Ltd from its majority shareholder Yima Coal Industry (Group), Sinocast reports.

In view of the fact that the target company’s net assets are estimated to be negative CNY15.68m, the equity transfer price is CNY1. However, because the cement company is heavily in debt, Tongli Cement will provide CNY440m entrusted loans before the equity transfer and inject an additional CNY300m after the acquisition. Yima has a design capcity of 1.55Mt of clinker.