Yip's Chemical intends to sell 51% of its solvent business for HK$2.688 billion

　　On July 26, Ye's Chemical Group Co.
, Ltd.
announced that it has signed a contract with Pacific Alliance Investment Group (PAG) to sell its solvent business subsidiary for RMB 2.
295 billion (equivalent to approximately HK$2.
688 billion or US$340 million).
The company's Qianxin Chemical Group Co.
, Ltd.
has a 51% actual interest in Taimeng
.
Taimeng will work with Yip's Chemical and other existing shareholders to develop the solvent business, promote the vertical integration of Qianxin Chemical's self-produced raw materials, reduce greenhouse gas emissions, and support the group's environmental protection strategy
.

　　Qianxin Chemical, a solvent business subsidiary of Yip's Chemical, is a world-leading solvent manufacturer with an extensive distribution network in China and overseas
.
With an annual solvent capacity of over 1.
6 million tons, Qianxin Chemical is the world's largest manufacturer of acetate solvents
.
Through the strategic cooperation with Taimeng, Qianxin Chemical will enter the acetic acid market, the upstream raw material of solvents, and plans to invest about RMB 1.
74 billion to build a new acetic acid plant with an annual production capacity of 600,000 tons in Jingmen Chemical Recycling Industrial Park in Hubei Province, China
.
The acetic acid produced by the project provides Qianxin Chemical with sufficient raw materials to ensure its quality and supply stability, and adjust the proportion of self-use and external sales according to demand, which will help increase revenue and reduce expenditure
.
Qianxin Chemical will purchase carbon monoxide, the main raw material for the manufacture of acetic acid, from Yingde Gas Jingmen Company, a subsidiary of the same Jingmen Industrial Park Gas Power Group
.
Gas Power is an enterprise controlled by Taimeng, and it is also a leading industrial gas supplier in China
.
This cooperation will help both parties to achieve mutual benefit and win-win results.
The short-distance gas transmission will help Qianxin Chemical reduce costs, and Yingde Gas will reduce carbon emissions by more than 300,000 tons per year
.
Negotiations for this strategic gas supply agreement are expected to be reached within a few weeks
.

　　Upon completion of the transaction, the Group will hold a 24% effective interest in Qianxin Chemical, and will continue to benefit from the considerable growth and profit contribution of the solvent business in the future
.
Yip's Chemical expects to receive approximately HK$2.
451 billion in net proceeds from the transaction and record an unaudited gain of approximately HK$1.
188 billion
.
"