Jiangsu Lanfeng sells 100 percent shares of Ningxia Lanfeng 01-24-2024

Summary: Jiangsu Lanfeng publicised the sale of 100% shares of its subsidiary Ningxia Lanfeng, which was aimed to optimise resource allocation and boost development in new energy business. In addition, due to the gloomy pesticide industry, part pesticide enterprises started to tap other fields to break from current morass.

On 2 Jan., 2024, Jiangsu Lanfeng Biochemical Co., Ltd. (Jiangsu Lanfeng) publicised the progress of selling 100% shares of Ningxia Lanfeng Fine Chemical Co., Ltd. (Ningxia Lanfeng), a wholly-owned subsidiary of the company. Here is the time line of the sale as per the announcement:

  • On 25 Dec., 2023, Jiangsu Lanfeng reviewed and passed the Proposal on Selling 100% Equity of Wholly-owned Subsidiaries, agreeing to make a full sale of Ningxia Lanfeng at USD2.9 million (RMB20.5 million) to Hebei Wanglian Agricultural Technology Co., Ltd. (Hebei Wanglian), a national designated pesticide producer founded on 27 March, 2012 with a registered capital of USD423,908 (RMB3 million) and located in Provincial Industrial Cluster in Xinle City, Hebei Province.
  • On 29 Dec., 2023, Ningxia Lanfeng had finished the registration change with all equities completely transferred to Hebei Wanglian, which means Jiangsu Lanfeng will no longer hold shares of Ningxia Lanfeng ever since.
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    Previously on 22 Sept., 2023, Jiangsu Lanfeng announced to increase capital of Ningxia Lanfeng from USD81.96 million (RMB580 million) to USD84.78 million (RMB600 million). However, due to industrial adjustment, the company started to shed part low-efficient agrochemical assets, including Ningxia Lanfeng. Ningxia Nanfeng boasted 14 products in early establishment, whereas affected by factors such as production process maturity, market demand, environmental protection policy and production cost, the company only remains production of carbendazim TC, 2-nitroaniline and o-phenylenediamine with that of the others stopped.

     

    On the same day, Jiangsu Lanfeng injected USD13.42 million (RMB95 million) to Xuzhou Lanfeng Biochemical Technology Co., Ltd. (Xuzhou Lanfeng), meanwhile accepting 40% equities held by Jiangsu Lanfeng Import & Export Co., Ltd., which made Xuzhou Lanfeng its wholly-owned subsidiary after the transfer. In addition, Jiangsu Lanfeng acquired 51% equities of Anhui Xuhe New Energy Technology Co., Ltd. to enter the photovoltaic industry. The selling of Ningxia Lanfeng will also help the company to further concentrate resource on the main business and accelerate shifting toward and upgrade of new energy industry.

     

    There are other pesticide enterprises began setting foot in new industries as well, in response to a generally sluggish market of pesticides. On 4 Aug. 2023, Limin Chemical Co., Ltd. struck a strategic cooperation agreement with Jiangxi Jinhui Lithium Material Co., Ltd., laying focus on new energy battery electrolyte projects, in a bid to raise competitiveness in the new energy material industry; on 4 Dec., 2023, Hunan Haili High-Tech Industry Group Co., Ltd., the controlling company of Hunan Haili Chemical Co., Ltd., achieved ground-breaking progress in vanadium industry, signing an equity transfer and capital increase contract with Hunan Yinfeng New Energy Co., Ltd., Guzhang Xiangfeng Construction Material Engineering Co., Ltd. and Guzhang Hongyuan Vanadium Industry Co., Ltd. (Hongyuan Vanadium), which includes purchasing 56.7% shares of Hongyuan Vanadium at USD15.26 million (RMB108 million).

     

    Enterprises like Jiangsu Lanfeng that adjusted asset and business structure are not in minority. In March of 2023, Jiangsu Flag Chemical Industry Co., Ltd. released an announcement on subsidiary equity transfer within the company, transferring all shares of wholly-owned subsidiary Jiangsu Suke Agricultural Chemical Co., Ltd. to its holding subsidiary Jiangsu Zhongqi Crop Protection Co., Ltd. at USD1.64 million (RMB11.6 million); on 18 Sept., 2023, Jiangsu Huifeng Agrochemical Co., Ltd. declared that to better deal with the debt issue of Jiangsu Jialong Chemical Co., Ltd. (Jiangsu Jialong), its wholly-owned subsidiary, it proposed to apply for bankruptcy liquidation of Jiangsu Jialong as a creditor, since the latter had inked a purchase and reserve agreement with Jiangsu Lianyungang Chemical Industrial Park.

    Source:CCM


    More information can be found at CCM Fungicide China Monthly Reoprt.


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