Wenzhou, Zhejiang –Huafon Spandex, the Shenzhen-listed elastane arm of Huafon Group, has absorbed the group’s PU resin and polyester polyol subsidiary, Zhejiang Huafon New Materials.
The deal completed on November 15, said an announcement by the elastane firm on the same day.
The transaction’s total price, CNY 12bn ($1.7 bn), will be paid in cash and new shares.
In 2018 Huafon New Materials recorded CNY 1.37bn net profit on CNY 10.7bn revenue.
Huafon Group, a leading polyurethane conglomerate in China, generated CNY 27.6bn revenue in 2018. This was up by 28% from 2017. Net profit in 2018 rose by 58% year on year to CNY 3bn.
The new materials said it expects generate net profit of CNY 975m in the 2019 financial year and that this will rise to CNY 1.41bn by 2021.
Currency convesion: XE.com