On July 28, Sinochem Hong Kong Holdings Limited (HKE: 0297) (Sinochem Hong Kong Holdings) is listed in Hong Kong after acquiring the fertilizer assets from Sinochem Corporation. Sinochem thus becomes the first Chinese fertilizer business listed overseas.
Sinochem Fertilizer Company is a core subsidiary of Sinochem and a leading fertilizer supplier and phosphate and compound fertilizer producer in China. it is also a leading importer of fertilizer with distribution network covering all the major Chinese agricultural provinces. Its business extends from R&D, production, import & export and domestic marketing and a business pattern of integrated domestic and overseas and upstream and downstream development has been formed, which plays an important role of guaranteeing the Chinese fertilizer market supply and promoting the healthy development of Chinese agriculture.
In 2004 with the approval of the State Council, Sinochem sold its fertilizer assets to its wholly-owned subsidiary based in Hong Kong-Sinochem Hong Kong (Group) Co., Ltd. to seek IPO in Hong Kong. In January 28 this year, Sinochem Hong Kong Holdings and its major shareholder Sinochem Hong Kong Group issued a joint declaration, formally acquiring Sinochem Fertilizer Company, which was approved by Hong Kong Exchange and Hong Kong Securities and Futures Commission on June 13. With the approval of the special shareholders' meeting on July 5, the management global road show was completed on July 20. As the controlling shareholder, Sinochem has about 66% of the listed company.
An important change to the equity structure of the listed company is the introduction of the biggest global potash manufacturer-Potash Corporation of Saskatchewan Inc as the strategic investor which owns 9.99% of the listed company and this percentage might rise to 20% in the next two or three years.
Talking about how to use the HK$2 billion raised by the listing, Mr. Liu Deshu, President of Sinochem Corporation and Chairman of the listed company said that in recent years the Chinese government is attaching increasing attention to agricultural development and domestic demands for high quality fertilizer keeps rising. The business environment and prospects of fertilizer industry are very promising. Sinochem Hong Kong will continue consolidating and strengthening its market leadership in the Chinese fertilizer industry and grow the fertilizer business big and strong so as to create wealth for the nation and value for the shareholders.