Shandong Lubei Chemical Co., Ltd. (SHSE:600727) intends to acquire Shandong Jinhai Titanium Resources Technology Co., Ltd. and Shandong Xianghai Titanium Resources Technology Co., Ltd. from Shandong Lubei Enterprise Group Company and Hangzhou Jinjiang Group Co., Ltd. for CNY 1.4 billion on November 1, 2019. Shandong Lubei Chemical Co., Ltd. entered into a supplemental agreement to acquire Shandong Jinhai Titanium Resources Technology Co., Ltd. and Shandong Xianghai Titanium Resources Technology Co., Ltd. from Shandong Lubei Enterprise Group Company and Hangzhou Jinjiang Group Co., Ltd. January 22, 2020. Under the terms, Shandong Lubei Chemical will acquire Shandong Jinhai Titanium of which 66% stake is acquired from Shandong Lubei Enterprise for CNY 910.8 million and 34% stake is acquired form Hangzhou Jinjiang for CNY 469.2 million for cash and stock of total CNY 1.38 billion and acquire Shandong Xianghai Titanium from Shandong Lubei Enterprise for cash of CNY 20 million. The cash consideration of the transaction is being funded from the matching funds through non-public offering of shares not exceeding CNY 549 million and the total amount of supporting funds raised shall not exceed 100% of the transaction price of the assets purchased in the transaction, the number of shares issued does not exceed 20% of the total share capital of the company before the transaction, that is, 70.2 million shares. As per the update dated February 25, 2020, the Shandong Lubei Chemical Co., Ltd. will pay CNY 831.1 million in cash and issue 88.9 million shares to acquire Shandong Jinhai Titanium Resources Technology Co., Ltd. and will pay CNY 20 million in cash to acquire Shandong Xianghai Titanium Resources Technology Co., Ltd. The financials of Shandong Jinhai Titanium Resources for the year ended December 31, 2018 are total assets of CNY 2.18 billion, total shareholder’s equity of CNY 1.21 billion, revenue of CNY 1.65 billion, operating income of CNY 130 million and net income of CNY 96 million. The financials of Shandong Xianghai Titanium Resources for the year ended December 31, 2018 are total assets of CNY 37.3 million, total shareholder’s equity of CNY 15.6 million, operating loss of CNY 2.73 million and net loss of CNY 2.77 million. The transaction is subject to approval of Board of Directors, shareholders, State-owned Assets Supervision and Administration Commission of Binzhou City and China Securities Regulatory Commission. The transaction is approved by the Board of Directors at the fifth meeting of the eighth directorate and on November 13, 2019, by the State-owned Assets Supervision and Administration Commission of Binzhou City. The issuance of shares and the payment of cash in the transaction is not subject to successful implementation of the matching financing. As of March 3, 2020, State-owned Assets Supervision and Administration Commission of Binzhou City approved the transaction that includes involving issuance of shares and payment in cash in exchange of assets and a private placement to raise supporting funds. As of March 18, 2020, shareholders of Shandong Lubei Chemical Co., Ltd. approved the transaction. The target asset assessment report involved in this reorganization has been approved by the Wudi County Finance Bureau. The transaction plan still needs to be approved by the China Securities Regulatory Commission. As of June 10, 2020, the transaction was approved by the China Securities Regulatory Commission. Hu Dongping, Tang Yong, Wang Jiawen, Liu Boyan, Chen Xingzhou, Zhou Yang Zhou Jie and Xu Peng of Haitong Securities Co., Ltd. acted as independent financial advisor to Shandong Lubei Chemical Co., Ltd. Gao Shu, Junwei and Chen Bo of China Commercial Law Firm acted as legal advisor to Shandong Lubei Chemical Co., Ltd. Huang Jinhui, zhou Zhonghua and Wang Xinyu of Reanda Certified Public Accountants Co., Ltd. acted as an accountant to Shandong Lubei Chemical Co., Ltd. Zhao Jiping,Song Daojiang, and Lou Bao of Zhengxin (Beijing) Asset Appraisal Co., Ltd acted as the Asset Evaluation Agency for Shandong Lubei Enterprise Group Company. Shandong Lubei Chemical Co., Ltd. (SHSE:600727) completed the acquisition of Shandong Jinhai Titanium Resources Technology Co., Ltd. and Shandong Xianghai Titanium Resources Technology Co., Ltd. from Hangzhou Jinjiang Group Co., Ltd. and Shandong Lubei Enterprise Group Company on July 3, 2020.