ShengdaTech
ShengdaTech is engaged in the business of manufacturing, marketing and selling nano precipitated calcium carbonate ("NPCC") products. The Company converts limestone into NPCC using its proprietary technology co-developed with Tsinghua University. ShengdaTech is the only company possessing proprietary NPCC technology in China.
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ShengdaTech expands to Yangtze delta with large NPCC acquisition
ShengdaTech has acquired Anhui Chaodong Nanomaterials Science and Technology Co., an inactive nano precipitated calcium carbonate (NPCC) facility in Hanshan County of Anhui Province with 10,000 metric tons of annual production capacity, making ShengdaTech the only NPCC producer in a province with a large number of manufacturers of plastics, adhesives and tires.
"Our acquisition of Chaodong and aggressive expansion plan provide us entry into the Yangtze River Delta, the home of numerous high-quality manufacturers from varied industries, giving us a vast, yet untapped target market," said Mr. Xiangzhi Chen, president and CEO of ShengdaTech. "Chaodong's key location near Wuhu, a major river port on the Yangtze River, will result in lower transportation costs and will facilitate our international sales growth."
ShengdaTech will pay approximately US$3.8m in cash to acquire 100 percent of Chaodong, including mining rights to approximately 14.25 million tons of limestone reserves and existing buildings and equipment and plans to invest an additional US$2.9m to upgrade Chaodong's technology and production facility.
In connection with the acquisition, the Company entered into an investment agreement with the Hanshan County government to expand the existing NPCC facility to add an additional 200,000 metric tons of production capacity with a total investment commitment of approximately US$175.7m.
The company has also separately agreed to purchase the land-use rights for approximately 66,767 square meters (16.5 acres) of land from the local government for the existing Chaodong facility at an estimated cost of approximately US$4.4m.
Both agreements are currently under government review and are subject to government approval.
