On the evening of March 8, Zhongnan Culture (002445) issued a major asset restructuring plan, proposing to acquire 57.30% equity of Jiangyin Sulong Thermal Power Co., Ltd. held by Jiangyin Electric Power Investment Co., Ltd. by issuing shares and paying cash, and raise supporting funds. The company’s securities will resume trading from the opening of the market on March 9. This transaction constitutes a major asset restructuring and will promote the company’s transformation to the comprehensive energy field.
At present, Zhongnan Culture’s main business covers three major sectors: machinery manufacturing, new energy, and cultural media. Among them, the machinery manufacturing sector mainly produces industrial metal pipe fittings, with downstream customers including power plants. In recent years, the company has faced bottlenecks in business development, with fluctuations in net profit, and urgently needs to break through the development dilemma through transformation and upgrading. This acquisition of Sulong Thermal Power is a key measure to implement the long-term development strategy.
It is reported that Sulong Thermal Power is a benchmark power plant in Jiangsu’s power industry and an AAAAA-level energy efficiency enterprise, mainly engaged in thermal power and heating business, and also lays out large-scale new energy projects with excellent asset quality. After the completion of this acquisition, the two parties will achieve in-depth synergy. Zhongnan Culture can rely on Sulong Thermal Power’s industry influence to expand regional thermal power customers and improve the market share and brand awareness of the machinery manufacturing sector.
Sulong Thermal Power, in turn, can provide technical feedback to help Zhongnan Culture optimize product design, improve product quality, and promote the quality and efficiency of pipe fitting business. As a local state-owned asset, Jiangyin Municipal State-owned Assets Supervision Office has always helped the company standardize its operation and improve quality and efficiency since Zhongnan Culture’s restructuring. This promotion of the acquisition of high-quality thermal power assets will further enhance the company’s core competitiveness and sustainable development capacity, laying a solid foundation for the company’s long-term high-quality development. At present, the specific payment ratio, amount and other details of the transaction will be determined after the audit and evaluation of the target company are completed.
