Henan Billions Chemicals Co., Ltd. (Henan
Billions), the biggest public company in China's TiO2 industry, announced that
it will raise funds privately for a titanium slag production project, which
will support its 60,000t/a chloride process TiO2 project, according to Titanium
China Monthly Report issued by CCM in
November.
The project investing into the upstream of
TiO2 was first put forward in Feb. 2013 (please refer to Titanium Dioxide China
Monthly Report 1303 for more details) and has been adopted by the board of
trustees. On 7 Nov., Henan Billions released an advanced plan for raising
capital of USD91.47 million (including issuance cost) to fund the construction
and the operating liquidity of its titanium slag project.
The titanium slag project includes two
phases. The first phase requires an investment of USD107.77 million, including
USD81.55 million for the construction and USD26.21 million for the operating
liquidity. The first phase is estimated to be completed after one and a half
years and is estimated to provide 150,000 tonnes of titanium slag every year,
which is sufficient for Henan Billions's 60,000t/a chloride process TiO2
project.
Henan Billions has embarked on this project
to reduce the effects of fluctuations in the titanium feedstock price and to
reduce its costs for raw materials. Possessing titanium resources means
initiative in industry chain, which is especially vital for developing chloride
process TiO2. Possessing titanium resources can reduce the raw materials cost
and cyclical fluctuations in profits, as the byproducts of titanium slag
produced in the machining process can offset the cyclical fluctuations of the
TiO2 industry. In order to reduce its reliance on titanium feedstock imports
and to cut costs, Henan Billions has reduced its import volume of titanium
feedstock in 2013 and has enhanced its purchases of domestic titanium
feedstock, especially those produced in Panzhihua City, Sichuan Province.
Although small investors of Henan Billions
oppose the capital raising plan and despite Henan Billions' stock declining by
5.47% to USD3.29 (RMB20.22) per share on 7 Nov., the day when the plan was
released, as the issue price is USD3.05 (RMB18.72) per share, the issue plan is
not likely to fail. This is because the issue plan is targeted at large
investors and the current controllers of Henan Billions. Therefore, although
the stock price is under the issue price, the targets of the issue plan will
still subscribe to the new shares.
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TiO2 price kept stable from mid-Oct. to mid-Nov.
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Henan
Billions to raise capital for its titanium slag project
CPI
Yuanda acquires upstream SCR TiO2 supplier
Import
volume increased by 22.42% while export volume declined by 6.46% in Sept.
Domestic
TiO2 price may edge down after the traditional selling season
Domestic
titanium feedstock supply increased in Sept. as domestic capacity expanded
Domestic
TiO2 market is improving as profitability improved and inventories fell in Q3
Titanium
Dioxide China Monthly Report, issued
by CCM on 25th, is mainly comprised of five columns of news and reports related
to TiO2 market, including “Supply & Demand”, “Company Dynamics”,
“Upstream”, “Downstream” and “Price Update”. You can find out more business
opportunities through the latest and helpful information provided in the
report.
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