Xiamen Tungsten Co.,Ltd. (600549.SH) has announced a plan to acquire a partial equity stake in Jiangxi Jutong Industrial Co., Ltd. (Jiangxi Jutong or the target company) to secure upstream tungsten raw material supply and enhance its self-sufficiency rate in tungsten resources. The company recently signed a tripartite cooperation agreement with Fujian Industrial Holding Group Co., Ltd. (Fujian Industrial Holding Group) and Jiangxi Tungsten Holding Group Co., Ltd. (Jiangxi Tungsten Group). Under the agreement, Fujian Industrial Holding Group has consented to have its affiliated enterprise transfer part of its equity in Jiangxi Jutong to Xiamen Tungsten and Jiangxi Tungsten Group. The portion to be acquired by Xiamen Tungsten from the affiliated enterprise of Fujian Industrial Holding Group is 30.1683%, with the final shareholding ratio subject to the formal equity transfer agreement to be executed by the involved parties.
The transaction price will be based on the preliminary assessment report issued by a third-party appraisal institution, which values the total equity of the target company at approximately RMB 19.66 billion. The final price will be determined according to the assessment results reviewed and filed by the State-owned Assets Supervision and Administration Commission of Fujian Province. Payment methods and timelines for the equity transfer will be separately stipulated in the formal equity transfer agreement.
As Xiamen Tungsten continues to expand its production capacity in downstream processing and application sectors of the tungsten industry chain—such as cemented carbide, cutting tools, and tungsten wire—its demand for tungsten resources has been increasing annually. Currently, the tungsten concentrate output from the company’s three operating tungsten mines and one under-construction tungsten mine only meets part of its requirements. Jiangxi Jutong holds mining licenses for the southern and northern areas of the Dahutang Tungsten Mine, with retained resource reserves of approximately 1.383 million tons of WO3 metal and about 33,000 tons of molybdenum metal. Acquiring equity in Jiangxi Jutong will help Xiamen Tungsten increase its mineral resource reserves, advance the development of the Dahutang Tungsten Mine, and thereby raise the company’s self-sufficiency rate in tungsten raw materials. This move is expected to reduce raw material procurement risks, ensure stable production and operation, minimize related-party transactions, and support the company’s sustainable development in line with its long-term strategic plans.
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