Puyang Huicheng Electronic Material Co., Ltd. agreed to acquire Highbroad Advanced Material Co., Ltd. from a group of 189 shareholders.
January 17, 2019
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Puyang Huicheng Electronic Material Co., Ltd. (SZSE:300481) agreed to acquire Highbroad Advanced Material (Hefe) Co., Ltd. from a group of 189 shareholders on January 18, 2019. Puyang Huicheng Electronic Material Co., Ltd. will pay the deal value in the form of a combination of shares and cash. After preliminary negotiation, the proportion of Puyang Huicheng Electronic Material Co., Ltd.'s proposed share-based payment was initially determined to be 85%, and the proportion to be paid in cash was initially determined to be 15%. Due to the large number of Highbroad Advanced Material (Hefe) Co., Ltd.'s shareholders, it is difficult for Puyang Huicheng Electronic Material Co., Ltd. to sign agreements with all shareholders before the signing of this plan. As of January 18, 2019, 182 shareholders have not signed an agreement with Puyang Huicheng Electronic Material Co., Ltd. Puyang Huicheng Electronic Material Co., Ltd. intends to raise matching funds though non-public issuance of shares targeting no more than 5 investors, and the total amount of matching funds raised shall not exceed CNY 700 million, which will be partially used for funding the cash portion of the deal value and repay Highbroad Advanced Material (Hefe) Co., Ltd.'s borrowings, apart from other purposes. The proportion of liquidity used to replenish Highbroad Advanced Material (Hefe) Co., Ltd. and repay the debt will not exceed 25% of the transaction price, or 50% of the total amount of funds raised. After the completion of the transaction, Highbroad Advanced Material (Hefe) Co., Ltd. will become a subsidiary of Puyang Huicheng Electronic Material Co.
As of September 30, 2018, Highbroad Advanced Material (Hefe) Co., Ltd. reported total assets of CNY 2.2 billion and net asstes of CNY 648.5 million. The deal is subject to sellers' internal decision-making authorities' approvals, second approval of Puyang Huicheng Electronic Material Co., Ltd.'s Directorate after the audit and assessment work are completed for assets of Highbroad Advanced Material (Hefe) Co., Ltd., approvals from Highbroad Advanced Material (Hefe) Co., Ltd.'s assets' Directorate and shareholders, Puyang Huicheng Electronic Material Co., Ltd.'s shareholders' approval, the municipal supervision bureau's approval of the concentration of operators and CSRC's approval. The transaction has been reviewed and approved at the thirteenth meeting of the third Directorate of Puyang Huicheng Electronic Material Co., Ltd. CITIC Securities Company Limited (SHSE:600030) acted as financial advisor to Puyang Huicheng Electronic Material Co., Ltd.
Highbroad Advanced Material Hefei Co Ltd is a China-based company mainly engaged in the provision of backlight display modules for semiconductor display panels. The Company is specialized in optical design, light guide plate design, precision mold design, overall structure design and intelligent manufacturing. The Company''s main products include backlight display modules, light guide plates, precision structural parts, optical materials and other related components. Its products are used in terminal products such as notebook computers, desktop monitors, tablet computers, car screens, medical monitors and industrial control monitors. The Company distributes products both in the domestic market and to overseas markets.