Xiamen Tungsten Industry Plans to Spend Nearly 400 Million to Acquire Two Companies

This article is reprinted from Haixia Daobao

Xiamen Tungsten Plans to Spend Nearly 400 Million Yuan to Acquire Two Companies

Increase Raw Material Self-Sufficiency

Daobao News (Reporter Wu Qiang) On March 24, Xiamen Tungsten (600549) announced that the company plans to invest 128.20302 million yuan to acquire a 30% stake in Jiujiang Dadi Mining Development Co., Ltd. (referred to as “Jiujiang Dadi”) held by related party Jiangxi Jutong Industrial Co., Ltd., and plans to invest 166.663926 million yuan to acquire a 39% stake in Jiujiang Dadi held by non-related party Beijing Shangdaxin Investment Co., Ltd., totaling approximately 295 million yuan to acquire 69% of Jiujiang Dadi.

After the transaction is completed, Xiamen Tungsten will become the controlling shareholder of Jiujiang Dadi Mining, and Jiujiang Dadi will be included in the company’s consolidated financial statements. Currently, Jiujiang Dadi Mining’s mining rights within its scope hold resource reserves of approximately 49,900 tons of WO_3 metal and 73,000 tons of Mo metal.

At the same time, to promote the company’s diversification strategy for cutting tool products and enhance the research and development capabilities of high-performance taps and cutters, Xiamen Tungsten’s subsidiary Xiamen Jinlu Special Alloy Co., Ltd. plans to invest 104 million yuan to acquire a 70% stake in Yuanzheng (Xiamen) Precision Tools Co., Ltd. (“Yuanzheng Precision”) held by individuals Gong Xing and Yao Aiping. After the transaction, Jinlu will become the controlling shareholder of Yuanzheng, which will be included in the company’s consolidated financial statements.

Xiamen Tungsten stated that as the company’s tungsten industry chain, especially the production capacity of cemented carbide, cutting tools, tungsten wires, and other downstream processing and application fields, continues to increase, the company’s demand for tungsten resources is growing year by year. The above transaction will help the company increase resource reserves, improve raw material self-sufficiency, reduce raw material procurement risks, and ensure stable production and operations. The transaction was approved by the company’s board of directors, audit committee, independent directors’ special meeting, and board deliberation on March 24, and does not require submission to the shareholders’ meeting.

In addition, to focus on core businesses such as tungsten-molybdenum, rare earths, and new energy materials, and optimize resource allocation, Xiamen Tungsten plans to transfer its 25% stake in Suzhou Aizhi Gaosi Electric Co., Ltd. through a public listing, with a listing price of 172 million yuan.