Limin Chemical plans
to make a private placement for its high-efficient pesticide projects, basic
raw material projects and replenishment in liquid capital. This will assist the
company to further expand business and improve profitability, which improves
its comprehensive competitiveness and carries forward the strategic goals.
Source: Limin Chemical's website
On
20 March, 2016, Limin Chemical Co., Ltd. (Limin Chemical) announced to make a
private placement for its high-efficient pesticide projects, basic raw material
projects and replenishment in liquid capital. Altogether 3,275.43 shares will
be issued to raise a fund of USD116.22 million (RMB759.90 million) for the
upgrading of the company's knockout products and the supply of upstream raw
materials. This investment is believed to further Limin Chemical's leading
position in China's fungicide market. Also, "It allows us to further expand
business and improve profitability, which makes us more competitive and carries
forward the strategic goals,' said Limin Chemical.
Upgrading
of leading pesticides and new profit growth
Limin Chemical intends to invest USD54.22 million (RMB354.51 million) of the
fund into the high-efficient projects, including:
- Metam-sodium project: 20,000 t/a
- Propineb project: 5,000 t/a
- Difenoconazole project: 500 t/a
- Azoxystrobin project: 500 t/a
Propineb, metam-sodium and difenoconazole have been the company's leading
fungicides for years. This expansion will make them more competitive by
upgrading techniques and quality.
Azoxystrobin became off-patent in 2010 and is a new generic pesticide. It is
broad-spectrum, targeted at many diseases caused by fungi, like powdery mildew,
rust, scab, downy mildew, rice blast, etc. This leads to its expansion in
fungicide market. Thus, it is the high time for Limin Chemical to develop
azoxystrobin project for new profit growth and richer product structure.
Self-sufficiency in raw materials to reduce cost
Altogether USD52.21 million (RMB341.39 million) will be used in the basic
material projects, including:
- Ethylenediamine project: 10,000 t/a
- 1, 2-Propylenediamine project: 5,000 t/a
The two, costing millions of dollars to purchase annually, are the major raw
materials for the company's propineb and mancozeb fungicides. At present, there
are still few 1, 2-propylenediamine and ethylenediamine manufacturers in China.
The domestic supply are dominated by international chemical giants, such as
BASF, and replenished by Shandong Lianmeng Chemical Group Co,. Ltd. Limin
Chemical can extend its supply chain up to raw materials after the construction
of the two projects. This will reduce the cost and guarantee the supply of raw
materials.
Replenishment in liquid capital to ease operating pressure
Totally USD9.79 million (RMB64 million) will be added to the liquid capital. As
the company's business expands, the need for operating capital and liquid
capital will also grow. This replenishment can relieve pressure from operating
capital shortage, reduce financial costs and enhance financial liquidity.
Limin
Chemical is one of the leading fungicide enterprises in China. So far, its
total capacity has reached 33,000 t/a. Specifically:
-
EBDC
fungicides (mancozeb, metiram, zineb, maneb): 20,000 t/a
-
Fosetyl-aluminium:
5,000 t/a
-
Metam-sodium:
5,000 t/a
-
Cymoxanil:
2,000 t/a
-
Pyrimethanil:
1,000 t/a
According to Limin Chemical, not only has it been the supplier for domestic
pesticide formulation enterprises, like Shenzhen Noposion Agrochemicals Co.,
Ltd. and Zhejiang Heben Pesticide & Chemicals Co., Ltd., but also for some
pesticide giants, like DuPont, Syngenta and Bayer CropScience. Moreover, over 60%
of the company's products are exported to Europe, Southeast Asia, Africa,
America and the Middle East.
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Tag: Limin Chemical, fungicide