Hunan Nanling Industrial Explosive Materials Co., Ltd. (SZSE:002096) entered into a letter of intent to acquire China Gezhouba Group Yipuli Co., Ltd from China Gezhouba Group Company Limited, Pangang Group Co., Ltd. and 93 individual shareholders on October 19, 2021. The consideration will be paid by issuing shares and/or paying cash. As of November 2, 2021, the consideration will be paid in the from of shares. China Gezhouba Group Yipuli Co., Ltd. reported total assets of CNY 4.82 billion and net assets of CNY 2.39 billion as at June 30, 2021. As of August 1, 2022 Deal terms have been revised Hunan Nanling Industrial Explosive Materials Co., Ltd. plans to purchase Approximately 670 million shares of China Gezhouba Group Explosive Co.,Ltd held by China Gezhouba Group Company Limited, Pangang Group Co., Ltd. and 23 natural persons by issuing shares. As of September 22, 2022, Hunan Nanling Industrial Explosive recently received the Hunan Provincial State-owned Assets Supervision and Administration Commission and would issue shares to purchase 95.54% of the shares of China Gezhouba Group Yipuli and raise matching funds at the same time. On 11 January 2023, Nanling Industry Explosive has received the Reply of Approval for Issuance of Shares by Hunan Nanling Industry Explosive Material Co., Ltd.* to China Gezhouba Group Stock Company Limited* and Other Parties for Assets Acquisition and Relevant Fund Raising issued by the CSRC, and the Reorganization is approved by the CSRC.


The transaction is subject to approval of Directorate of Hunan Nanling Industrial Explosive Materials again, approval of shareholders of Hunan Nanling Industrial Explosive Materials, approval of shareholders of China Gezhouba Group Yipuli, approval of State-owned assets supervision and administration department, approval of State Administration of Science, Technology and Industry for National Defence (if needed), approval of CSRC and approval of the Anti-Monopoly Bureau of the State Administration for Market Regulation. Transaction has been approve by Anti monopoly authority. The Board of Directors of Hunan Nanling Industry Explosive Material Co., Ltd. and China Gezhouba Group Co., Ltd.'s chairman office approved the transaction. As of September 24, 2022, the transaction is approved by State-owned Assets Supervision and Administration Commission. As on December 9, 2022, The Hong Kong Stock Exchange has approved the Proposed Spin-off. As of December 11, 2022, Hunan Nanling Industrial Explosive Materials has issued 752,005,914 shares with CNY 7.15 per share as payment for this acquisition. As on December 30, 2022, China Energy Engineering Corporation Limited reports that they there profit forecast compensation Agreement entered into by the Performance Covenantors, Nanling Industry Explosive and Gezhouba Explosive for the Issuance of Shares by Nanling Industry Explosive. As of December 29, 2022, The transaction has approved unconditionally by The China Securities Regulatory Commission on December 28, 2022.

China International Capital Corporation Limited (SEHK:3908) acted as the financial advisor to Hunan Nanling Industrial Explosive Materials. Zhang Xuebing, Mu Jingli and Li Kefeng acted as due diligence provider to Hunan Nanling Industrial Explosive Materials Co., Ltd. Hunan Qiyuan Law Firm acted as legal advisor to Hunan Nanling Industrial Explosive. KPMG Huazhen LLP Shanghai Branch acted as an accountant to Hunan Nanling Industrial Explosive Materials Co., Ltd. Huatai United Securities Co., Ltd. acted as financial advisor to Hunan Nanling Industrial Explosive Materials.

Hunan Nanling Industrial Explosive Materials Co., Ltd. (SZSE:002096) completed the acquisition of China Gezhouba Group Yipuli Co., Ltd from China Gezhouba Group Company Limited, Pangang Group Co., Ltd. and 93 individual shareholders on January 12, 2023.