Zhuhai Zhongfu Announces Share Placement Plan
Expects Fundraising Amount Not Exceeding RMB700 Million
Commits to expanding production capacity and improving profitability
Further consolidates leadership position in China's beverage packaging industry
HONG KONG and ZHUHAI, China, March 19 /PRNewswire-Asia/ -- China's leading beverage packaging and PET bottling company, Zhuhai Zhongfu Enterprise Holdings Limited ("Zhuhai Zhongfu"; stock code: SZ000659), today announced the details and capital allocation of its non-public share placement plan.
Zhuhai Zhongfu plans to issue 30-79 million shares (both upper and lower limits inclusive) at the issue price of no less than RMB 7.02 per share, and the share placement target is limited to no more than 10 designated investors. It is expected that the fundraising size will not exceed RMB 700 million (excluding fees incurred from share issuance), and the net proceeds will be fully committed to the expansion program of the Company's core businesses, namely the manufacturing of PET bottles, bottle blowing and drink refilling. The detailed expansion program and capital allocation plan are as follows:
Project Total Project details Expanded
investments production
(RMB scale
million) (per annum)
Expansion of Approx. Establish PET bottle 2,073.6
PET 435.19 manufacturing bases in million
bottle Chongqing, Zhuhai, Shenyang,
production Hefei, Beijing, Hangzhou
and Tianjin. Funds will be
used for acquiring
different PET bottling
facilities and equipment.
Expansion of Approx. Expand bottle blowing lines 828 million
bottle 124.10 at Fuzhou, Zhuhai,
blowing line Hefei and Chongqing.
Funds will be used for
acquiring different
bottle blowing facilities
and equipment.
Expansion of Approx. Expand refilling lines at 576 million
drink 116.95 Chongqing, Nanning,
refilling Nanchang and Kunshan. Funds
line will be used for acquiring
refilling facilities and
equipment.
Enhancement of Approx Purchase IT equipment and --
information 12.00 systems in order to
system upgrade the Company's
current information
system, optimize its
production and marketing
process as well as
information sharing, and
enhance management
efficiency.
TOTAL Approx.
688.24
The Company is committed to this expansion plan. If the final fundraising amount is less than RMB 700 million, it will settle the outstanding portion via other means, such as internal funding and bank borrowings.
Mr. Gary Guernier, Chairman of Zhuhai Zhongfu, said, "Through the share placement plan we aim to institutionalize our core businesses and further enhance our existing production scale and market share, sharpen our competitive strengths in China's beverage packaging industry, improve our profitability, and consolidate our leadership position.
"China's economy is experiencing rapid, persistent growth, and the domestic beverage market is likewise booming, driven by increasing beverage consumption per capita. Meeting this market potential requires additional capacity in plastic packaging for beverages. Diversified product development and demand also provide considerable future opportunities for PET bottle manufacturers.
"Meanwhile, leading overseas beverage giants have been increasing their investments and expansion efforts in China, creating very promising opportunities for our own growth. The capital secured from this share placement will be used to increase our production capacity so as to support our major clients' needs in China, ultimately stabilizing and expanding Zhuhai Zhongfu's market share."
Currently, PET bottles remains the fastest-growing segment with the highest share in China's beverage packaging industry, and it is expanding into various new applications. The rapid growth of the soft drink market has enabled the PET bottle industry to achieve growth of over 15% per annum over the past five years, making it the top performer in plastic packaging for food and beverages.
Mr. Guernier concluded, "We are committed to measures that will facilitate our long-term growth, for example increasing our capacity as well as our product range. We are confident that this will help us and our clients capture opportunities arising from the booming Mainland economy, thriving domestic consumption, and the promising growth of China's beverage and packaging industry. With production expansion and information systems enhancement occurring in various provinces and cities, our operational management will be fully institutionalized and able to improve the product quality and technology of our integrated facilities, leading the modernization and internationalization of China's beverage packaging industry."
Controlling shareholder Asia Bottles (HK) Company Limited, which fully supports Zhuhai Zhongfu's expansion plan, comprises foreign investors and requires regulatory approval to participate. In the best interests of the Company, the controlling shareholder has therefore decided not to subscribe for the share placement. Completion of this share placement will not incur significant changes towards the shareholding structure, although the controlling shareholder's interest will decrease from 29% to 26.01% based on the upper-limit estimate of 79 million shares issued.
About Zhuhai Zhongfu Enterprise Holdings Limited
Zhuhai Zhongfu Enterprise Holdings Limited ("Zhuhai Zhongfu"; stock code: SZ000659) was established in 1982. It is principally engaged in the production and marketing of PET bottling, PVC and OPP labeling, and drink refilling. Zhuhai Zhongfu is one of the largest PET bottle manufacturers in China, and the first company supplying PET bottles to Coca-Cola in China. The Company has over 80 production facilities and an annual production capacity of over 5.5 billion. Its products include PET bottles for carbonated soft drinks, drinking water and beer. It has received various honors and awards at the national and provincial level. The Company was listed on the Shenzhen Stock Exchange (Main Board) in 1996, the first entity in China's beverage packaging industry to be listed. For more details, please visit the Company's website: http://www.zhongfu.com.cn .
For inquiries, please contact:
GolinHarris
Gloria Chiu
Tel: +852-2501-7970
Email: [email protected]
Madison Wai
Tel: +852-2501-7903
+852-9306-1632
Email: [email protected]
SOURCE Zhuhai Zhongfu Enterprise Holdings Limited
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