Fujian Cement (600802), plans to set up a joint venture, Fujian Jianfu Southern Cement, with its second-largest shareholder, Southern Cement, in order to integrate the cement industry in Fujian, and both parties will conduct mergers, acquisitions, and expand production capacity, reports China Securities Journal, citing a company filing.

Both companies will each hold a 50 percent interest in the joint venture, which will engage in cement-related businesses with the "Jianfu" brandname in Sanming, Longyan, Xiamen, Zhangzhou, and Quanzhou.

Fujian Cement will inject part of its capacity into the joint venture, and said the joint venture will help to increase production capacity and assets.

Southern Cement, founded in September 2007, is a wholly-controlled subsidiary of China National Building Material (3323.HK). It is headquartered in Hangzhou, with a registered capital of 10 billion yuan.

According to industry insiders, the cooperation between Fujian Cement and Southern Cement will help to accelerate the consolidation of the cement industry in south-east China.

Source:capitalvue.com