Sinochem International recently announced that in order to actually control related assets of Sinochem Group’s pesticide businesses and promote integration and professional development of the company’s pesticide business, Sinochem International plans to invest a total of 970,162,200 yuan to acquire the entire equity of Sinochem Agrochemical, Shenyang Sciencreat Chemicals, Sinochem Agrochemical HK, Sinochem Agrochemical Brazil, and Sinochem Agrochemical Argentina.

Of the equity value of the underlying companies in the proposed acquisition, the actual acquisition cost reaches around 669 million yuan, 301 million yuan of non-pesticide business will be stripped before December 31, 2014. After the completion of this transaction, the pesticide business-related assets of Sinochem’s subsidiaries, excluding Shenyang Research Institute of Chemical Industry which is R&D-related, will all be integrated into the control of Sinochem International.

Sinochem International said Sinochem’s subsidiary pesticide businesses are currently distributed under different subjects. The transaction will promote improvement of the company’s pesticide business chain and enrichment of the product portfolio, help expand the market coverage, increase the industrial scale, bring the overall advantages into play and enhance market competitiveness. In the meantime, it will also help to reduce connected transactions within the group and horizontal competition.

Currently, Sinochem Group has made it clear that Sinochem International will be the main body for its pesticide businesses after the integration. After the completion of this connected transaction, Sinochem Group will start relevant reorganization procedures for Shenyang Research Institute of Chemical Industry. It aims to round off injection of funds into Shenyang Research Institute of Chemical Industry within the future 12 months.

Sinochem International has been committed to the layout arrangement of the agrochemical field over the past two years. By purchasing shares, the company now holds 29% of the total shares of Nantong Jiangshan Agrochemical & Chemicals and 40.5% of Yangnong Chemical Group’s. The annual equity capacity of glyphosate for Sinochem International reaches 26,000 tonnes.