Sinofert Holdings (HKG:0297) announced that it has agreed to sell its 40% equity interests in Yunnan Three Circles Sinochem Fertilizer Co., Ltd to Yunnan Yuntianhua Co., Ltd (Yuntianhua Company) for an estimated total consideration of approximately RMB425.135 million, which will be satisfied in full by the issue of Yuntianhua consideration shares issued by Yuntianhua Company. The lock-up period of Yuntianhua consideration shares is 12 months.

Upon completion of the disposal, Sinofert is expected to recognize a pre-tax gain of approximately RMB50 million from such disposal.

Yuntianhua Company is principally engaged in the production and sale of nitrogen fertilizer, glass fiber and organic materials, and its main products are synthetic ammonia, urea, glass fiber and polyformaldehyde.

Yunnan Three Circles is principally engaged in the production and sale of phosphorus chemical products such as diammonium phosphate, phosphoric acid and sodium fluorosilicate.

The directors of Sinofert are of the view that through the transaction, Sinofert will be able to establish a long-term strategic cooperation relationship with Yuntianhua Group and acquire phosphorus ores and other assets indirectly.

Source:chinesestock.org