Shuangma Cement to raise CNY2.8bn to buy assets
Sichuan Shuangma Cement, a subsidiary of Lafarge, said it will conduct a private placement of 250m shares at not less than CNY11.25 (US$1.74) per share to a maximum of 10 designated investors, reports Shanghai Securities News.
The proceeds of CNY2.81bn will be used to purchase a 25% stake in Dujiangyan Lafarge, a 75% stake in Guizhou Dingxiao, a 75% in Guizhou Xinpu, and to fully acquire Zunyi Sancha.
Upon the completion of the acquisitions, the operational area of Shuangma Cement will be expanded from Sichuan province to Guizhou province.
Dujiangyan Lafarge, Guizhou Dingxiao and Guizhou Xinpu recorded 2010 net profits of CNY414m, CNY2.12m and CNY1.49m, respectively. Zunyi Sancha posted a loss of CNY22.82m in 2010.
Shuangma Cement recorded net profit of CNY33.93m in 2010.
According to the report, the second-largest shareholder of Shuangma Cement, Lafarge Shui On (Sichuan) Investment, will further inject its cement assets into Shuangma Cement.
Lafarge will remain as the parent of Shuangma Cement after the completion of the private placement, which will see its stake in Shuangma Cement falling from 77.6% to an estimated 55.19%.
Shares of Shuangma Cement resumed trading today, with the stock up 7.79% to close the morning session at CNY14.26.
Published under Cement News
