The subsidiary of Zhejiang Weihua New Material (603310.SH) plans to acquire 70% equity of Heyutai for 154 million yuan.

Zhejiang Weihua New Material (603310.SH) announced that its subsidiary Zhejiang Fanghua Chemical Co., Ltd. (hereinafter referred to as "Fanghua Chemical") plans to acquire 70% equity of Jiangsu Heyu Tai Chemical Co., Ltd. (hereinafter referred to as "Heyu Tai" or the "target company") held by Zhejiang Xinhua Jinyu Bio-Technology Co., Ltd. (hereinafter referred to as "Xinhua Bio") in cash, with a transaction price of 154 million yuan. The funds will come from own funds and bank loans. After the completion of this transaction, Heyu Tai will become a subsidiary controlled by the company. The target company is currently in a loss-making stage, mainly due to the continuous low fluctuation of agricultural chemical product prices and insufficient capacity utilization. However, there are signs of improvement in the loss situation, with a narrowing of losses in the first half of 2025 compared to the same period last year, and further improvement in business performance in the third quarter. After the completion of this acquisition, measures such as expanding sales channels, further improving capacity utilization, optimizing product processes, and strengthening internal operations management will be taken to strive for the target company to achieve a turnaround in 2026 and continue to generate stable income in the future. Three of the main raw materials consumed by the target company's existing products are the main products of the listed company and its subsidiary. Currently, the target company purchases from the listed company and external suppliers. After this equity acquisition, the company will provide stable supply support for these raw materials of the target company, reducing the uncertainty of external procurement and optimizing production rhythm through internal coordination to improve overall operational efficiency and income.