While entering the second year of the 12th
Five-Year Plan, domestic pesticide industry has gradually shown a sign of
slight recovery in 2012. Followed the direction of Pesticide Industrial Policy
and 12th Five-Year Plan for Pesticide Industry, M&A and expansion cases
among domestic pesticide enterprises have also witnessed growth, according to Crop
Protection China News 1301 issued by CCM.
Except for the acquisition cases, the
Ministry of Industry and Information Technology of China (MIIT) has approved 8
batches containing 13 merger cases in 2012, involving 26 domestic pesticide
enterprises.
In this issue, CCM will list main cases of
M&A and some external expansion that took place in domestic pesticide
industry in 2012.
1. Sinochem & Jiangsu Yangnong
Sinochem International Corporation
(Sinochem), one of the largest state-owned chemical groups in China, announced on 21 Feb., 2012 that it
intends to invest less than USD259.37 million in Jiangsu Yangnong Chemical
Group Co., Ltd. (Yangnong Group), a large chemical group in Jiangsu Province,
as a strategic investor. The transaction will make Sinochem the second largest
share holder in the group which also means that Sinochem will benefit a lot by
enhancing its R&D and industrial transforming capacity, enriching
production lines and improving industrial chain from the group ascribed to its
powerful industrial base and high-efficient synergy value with the fine
chemical engineering and farm chemical businesses. On the other hand, Yangnong
Group and Jiangsu Yangnong Chemical Co., Ltd., (Jiangsu Yangnong), a leading
pyrethroid insecticide player in China and a listed pesticide
subsidiary of Yangnong Group respectively, will get more financial support to
expand business in both domestic market and oversea market.
On 9 Dec., 2012, Jiangsu Yangnong announced
to set up a new pesticide production subsidiary in Rudong County, Jiangsu
Province, with a total investment of USD28.52 million. The new subsidiary was
planned to be mainly engaged in the production and sales of pesticides and
pesticide intermediates, fine chemicals, etc.
2. Huapont
On 24 March, 2012, aiming to further expand
its pesticide business, Chongqing Huapont Pharm Co., Ltd. (Huapont), a listed
pharmaceutical company in China, planned to raise USD144.76 million through
non-public offering of A shares for the construction of four new projects,
namely a construction project of a new R&D base, construction project of
600t/a azoxystrobin, 900t/a sulcotrione/mesotrione and 3,500t/a pesticide
formulations, a medicine formulation technical innovation project and a circulating
fund supplementation project.
On 8 May, 2012, Huapont announced to
conduct its first acquisition in 2012. It planned to purchase 49% equities of
Hebei Wanquan Hongyu Chemical Co., Ltd. (Wanquan Hongyu), a large herbicide
producer in Hebei
Province with main
products of 37% clethodim TK and metamitron TC.
Later on, Huapont continued to expand in
domestic pesticide industry. It announced on 24 Aug., 2012 to acquire 58.26%
equity of Hangzhou Qingfeng Agro-chemical Co., Ltd. (Hangzhou Qingfeng), a
large pesticide enterprise in Zhejiang
Province, with a total
investment of USD9.16 million. Till then, Huapong started to set foot in
agrochemical formulation industry.
3. Noposion
Shenzhen Noposion Agrochemical Co., Ltd.
(Noposion), a leading pesticide formulation company in China, announced on 23 March, 2012 that it plans
to increase the registered capital of Shandong Qutii Machine Co., Ltd.
(Shandong Qutii), an agricultural machinery subsidiary of Noposion, by
co-investing USD3.17 million with Maruyama Manufacturing Company Inc.
(Maruyama), a large agricultural machinery corporation in Japan.
4. Nanjing
Redsun
Nanjing Redsun Co., Ltd. (Nanjing Redsun),
a leading pyridine pesticide producer in China,
announced on 24 April, 2012 that it planned to set up a brand new pesticide
subsidiary in Chongqing City,
China, with a
total investment of USD21.59 million.
The new subsidiary will be mainly engaged
in the production and sales of pesticides, pesticide packages, and pesticide
intermediates (such as pyridine, 2-methyl pyridine and 3-methyl pyridine). And
the foundation of it was aiming at the expansion of current pesticide
businesses and cultivation of new economic growth points for Nanjing Redsun.
5. Anhui
Huilong
Aiming to expand its business in other
provinces, Anhui Huilong Agricultural Means of Production Group Co., Ltd.
(Anhui Huilong), a listed agricultural chain management enterprise in Anhui
Province, announced on 23 May, 2012 that it will invest USD5.65 million
(RMB35.76 million) to establish two new companies, namely Anhui Huilong
Agricultural Means of Production Group Agricultural Science and Technology Co.,
Ltd. (AHAMPGAST) and Guangdong Huilong Agricultural Means of Production Co.,
Ltd. (Guangdong Huilong).
Right after releasing its expansion
strategy in Guangdong Province, Anhui Huilong planned to kick off its further expansion
in South China. On 13 June, 2012, Anhui
Huilong announced to acquire 60% equities of Hainan Agricultural Means of
Production Co., Ltd. (HAMP), one of the largest agricultural means of
production companies in Hainan
Province, with USD12.37
million.
6. ABA
Chemicals
On 2 June, 2012, ABA Chemicals Corporation
(ABA Chemicals), a listed pesticide intermediate and pharmaceutical
intermediate producer in China,
announced to co-found a pesticide subsidiary with Jiangsu Jiannong Agrochemical
Co., Ltd. (Jiangsu Jiannong), a private pesticide producer in Jiangsu Province,
with a total investment of USD15.8 million. After the foundation of the new
company, ABA Chemicals will be formally involved in domestic pesticide
industry.
7. Zhejiang
Wynca
Zhejiang Wynca Chemical Inudustry Group
Co., Ltd. (Zhejiang Wynca), one of the largest glyphosate producers in China, announced to set foot in seed industry on
5 May, 2012 by acquiring 51% equities of Shandong Xinfeng Seed Co., Ltd.
(Shandong Xinfeng), a large seed enterprise in Shandong Province,
with a total investment of about USD10.74 million.
8. Shandong
Lubei
In order to exploit the Association of
Southeast Asian Nations (ASEAN) market, Shandong Lubei Enterprise Group General
Company (Shandong Lubei), a big corporation which produces aluminum oxide,
titanium dioxide, chemical fertilizer and so on, planned to construct a
pesticide formulation factory in Myanmar.
On June 21, 2012, a delegation from
Shandong Lubei went to Myanmar
for inspection and visit. Shandong Lubei was invited by the Myanmar Ministry of
Agriculture to construct a pesticide factory for herbicide, insecticide and
plant growth regulator production in Myanmar.
9. Nantong
Jiangshan
Nantong Jiangshan Agrochemical &
Chemicals Co., Ltd. (Nantong Jiangshan), a listed pesticide manufacturer in China, announced on 20 Nov., 2012 that it plans
to acquire 90% equities of Ladda Group Holdings Co., Ltd. (Ladda Group), a
large agrochemical enterprise in Thailand, at a cost of less than
USD33.39 million. And after completing the transaction, Nantong Jiangshan will
further invest USD3.9 million in Ladda Group as an operation fund, then its
controlling equity percentage of Ladda Group will reach 91%.
In addition to all the acquisition cases,
some pesticide enterprises sold their subsidiaries aiming to be in accordance
with their overall strategies.
Hailir Group & Nantong Jiangshan
Aiming to pull up the profit margin of net
assets in a short time for its IPO, Hailir Pesticides and Chemicals Group
(Hailir Group), a state-appointed pesticide formulation manufacturer in China, planned
to peel off some relatively inferior assets. It announced on 6 March, 2012 to
sell out all equities of its pesticide technical subsidiary, namely Qingdao KYX
Chemical Co., Ltd. (Qingdao KYX).
Owing to the high relocation fees, Nantong
Jiangshan announced on 1 June, 2012 that it planned to launch an equity
transfer of all the shares of Nantong Dongchang Chemical Industrial Co., Ltd.
(Nantong Dongchang), a large chemical producer, that it holds, about 28.05
million shares accounting for 67.79% of the total equity of Nantong Dongchang.
Nantong Dongchang was forced to relocate within 2012 according to the
relocation policy of local government and the relocation fees reached to
USD2.59 million which would be self-financed.
Main expansion cases of domestic pesticide
enterprieses in 2012
First standard for commodity supervision
and sampling inspection released
China
brews soybean industrial policy adjustment
China
needs to attach importance to regulate on pesticide adjuvants in extra small
package
Pyridine price rises, paraquat follows
Nutrichem gains GLP certification from OECD
Performance prediction of main domestic
pesticide companies in 2012
Jiangsu Huifeng to set foot in seed industry
Crop
Protection China News, a monthly publication issued
by CCM on 31st, offers timely update and close follow-up of China’s crop protection
industry dynamics. It also provides you with professional features articles, keeping
you aware of the latest industrial development, import and export analysis, and
market data.
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