Worth reading
62In focus
0–100. This measures how worthwhile something is to read, not how good or bad the company is.Direction
Mixed performance
Direction inferred from the company’s description.Scale
20
CNY 2.0 billion (approximately ¥46.6 billion)Wording
Conditional
How definitive the wording is.This transaction
Establishment of a new company, capital investment and CRSM private placementCounterparty合肥市建設投資控股（グループ）有限会社, 合肥国有資本創業投資有限会社, 合肥晶汇聚芯投資基金有限パートナー, 蘇州東証睿景創業投資有限パートナー
Disclosing companyFerrotec Corporation
The voting-rights ratio is the share of the votes exercisable at a shareholders’ meeting that will be held after this transaction.
TimelineThe spacing between the points is proportional to the actual number of days.
Target company
Wafer recycling and related businesses
Location 21 Nanhai Road, Yi'an Economic Development Zone, Yi'an District, Tongling, Anhui Province, ChinaShare capital CNY 1.2201 billion (approximately ¥28.4 billion)Date of incorporation 6 September 2019
Net Sales¥2,869 million (fiscal year ended March 2025)
Operating profitOperating loss of ¥1,483 million (fiscal year ended March 2025)
Net income for the current fiscal yearNet loss of ¥515 million (fiscal year ended March 2025)
Net assetsNet assets of ¥16,505 million (fiscal year ended March 2025)
Consideration and expenses
Acquisition priceThe total contribution payment for the portion decided at this time is CNY 45 million (approximately ¥1.1 billion), comprising CNY 25 million (approximately ¥600 million) from 合肥晶汇聚芯 and CNY 20 million (approximately ¥500 million) from 蘇州東証睿景. The total contribution payment for the entire private placement is CNY 1.4 billion (approximately ¥32.6 billion).
Type of ConsiderationCash
Funding arrangementsOf the total investment of CNY 2.0 billion, CNY 1.4 billion is expected to be funded through equity contributions and CNY 600 million through borrowings.
Impact on Business Performance
The impact on the Company's earnings from CRSM changing to an equity-method affiliate is expected to be immaterial.
Procedures and assumptions
Valuation methodologyCalculation of the fair value of the shares by an independent third-party valuation institution unaffiliated with the Company or the subscribers
Independent valuation institutionName not disclosed (an independent third-party valuation institution unaffiliated with the Company or the subscribers)
Management structure after acquisitionThe chairman of the new company will be 賀賢漢 (He Xianhan). 合肥国投 is expected to become CRSM's largest shareholder. Employee treatment: not disclosed
| Item | Details |
|---|---|
| Transaction name | Establishment of a new company, capital investment and CRSM private placement |
| Counterparty name | 合肥市建設投資控股（グループ）有限会社, 合肥国有資本創業投資有限会社, 合肥晶汇聚芯投資基金有限パートナー, 蘇州東証睿景創業投資有限パートナー |
| Name of the Subject Company | 安徽富楽徳長江半導体材料股份有限公司（CRSM） |
| Business Description of the Subject Company | Wafer recycling and related businesses |
| Location of the Subject Company | 21 Nanhai Road, Yi'an Economic Development Zone, Yi'an District, Tongling, Anhui Province, China |
| Capital Stock of the Subject Company | CNY 1.2201 billion (approximately ¥28.4 billion) |
| Date of Establishment of the Subject Company | 6 September 2019 |
| Net Sales of the Subject Company | ¥2,869 million (fiscal year ended March 2025) |
| Operating Profit of the Subject Company | Operating loss of ¥1,483 million (fiscal year ended March 2025) |
| Net Income of the Subject Company | Net loss of ¥515 million (fiscal year ended March 2025) |
| Net Assets of the Subject Company | Net assets of ¥16,505 million (fiscal year ended March 2025) |
| Acquisition price | The total contribution payment for the portion decided at this time is CNY 45 million (approximately ¥1.1 billion), comprising CNY 25 million (approximately ¥600 million) from 合肥晶汇聚芯 and CNY 20 million (approximately ¥500 million) from 蘇州東証睿景. The total contribution payment for the entire private placement is CNY 1.4 billion (approximately ¥32.6 billion). |
| Type of Consideration | Cash |
| Voting rights ownership percentage | Before 40.65% → after 25.85% |
| Funding arrangements | Of the total investment of CNY 2.0 billion, CNY 1.4 billion is expected to be funded through equity contributions and CNY 600 million through borrowings. |
| Impact on Business Performance | The impact on the Company's earnings from CRSM changing to an equity-method affiliate is expected to be immaterial. |
| Date of board resolution | 20 April 2026 |
| Execution Date / Effective Date | Establishment of the new company: 3 March 2026; payment date for the CRSM private placement: April 2026; commencement of operations at the new plant: scheduled for December 2027 |
| Valuation methodology | Calculation of the fair value of the shares by an independent third-party valuation institution unaffiliated with the Company or the subscribers |
| Independent valuation institution | Name not disclosed (an independent third-party valuation institution unaffiliated with the Company or the subscribers) |
| Management structure after acquisition | The chairman of the new company will be 賀賢漢 (He Xianhan). 合肥国投 is expected to become CRSM's largest shareholder. Employee treatment: not disclosed |
Items this document does not state (11)
Expenses other than the acquisition priceMerger ratio/share exchange ratioTender offer priceMinimum number of shares to be purchasedTender offer periodNumber of shares acquiredGoodwill amountAmount of extraordinary income (loss)Contract DateSpecial CommitteeConditions Precedent to Execution
These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.
The reasons the company gives
The company's own explanation, not something inferred from the numbers.Supply shortages are intensifying in the reclaimed wafer market, and demand at CRSM is also exceeding production capacity. The investment is intended to expand production capacity, promote the domestic production of reclaimed wafers in China and develop overseas markets, while making CRSM non-consolidated to improve profitability and focus the business on selected areas.
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