September 25, 2024 – Hubei Yihua Chemical Industry Co., Ltd. (hereinafter referred to as “Hubei Yihua”) has recently unveiled the latest developments regarding the equity transfer of its subsidiary, Hubei Yihua Degradable New Materials Co., Ltd. (abbreviated as “Yihua Degradable New Materials”). According to the announcement, Hubei Yihua has finalized the “Hubei Province Overall Property Rights and Controlling Equity Transfer Contract” with Yihua Group, with the transaction concluding at the listed base price of 151.1875 million yuan. This move follows Hubei Yihua’s previous announcement on June 24, where it declared the intention to sell 100% of Yihua Degradable New Materials’ equity, setting a minimum transfer price of no less than 151 million yuan.
Hubei Yihua elaborated that the decision to sell Yihua Degradable New Materials was primarily driven by the sluggish market demand for its core product, PBAT (Poly(butylene adipate-co-terephthalate)), coupled with the persistent financial losses incurred by the subsidiary. The company anticipates that this transaction will effectively optimize resource allocation, thereby enhancing its overall profitability. It is noteworthy that Yihua Degradable New Materials undertook and completed the “60,000 tons/year Biodegradable New Material Project” in 2023, with cumulative investments reaching a substantial 494 million yuan, significantly surpassing the selling price in this transaction.
Meanwhile, according to insights from ColorMasterbatchIndustry.com, Hubei Yihua has not halted its strategic deployments in the chemical sector amidst the equity transfer process. Recently, the company collaborated with Do-Fluoride Chemicals to jointly establish Hubei Fluorosilicon Yicheng New Materials Co., Ltd., with a registered capital of 100 million yuan. The new venture’s business scope encompasses the manufacturing and sales of specialized chemical products, as well as the production of electronic specialty materials, among other areas, demonstrating Hubei Yihua’s continuous deepening and expansion in the field of chemical new materials.