On July 1, Kaisheng Technology successively issued two equity acquisition announcements, the company intends to acquire 100% of the equity of Kaisheng Quartz Materials (Taihu Lake) Co., Ltd. (hereinafter referred to as "Taihu Quartz") and 70% of the shares of Anhui Kaisheng Basic Material Technology Co., Ltd. (hereinafter referred to as "Kaisheng Substrate"). In addition, on the same day, Kaisheng Technology also announced that the second phase of the ultra-thin flexible glass (UTG) project and the Shenzhen Guoxian new display R & D and production base project will be postponed.
Acquired 100% equity interest in Taihu Quartz
According to the announcement of Kaisheng Technology, the company intends to acquire 100% of the equity of Kaisheng Quartz Materials (Taihu) Co., Ltd. held by CNBM Mineral Resources Group Co., Ltd., a subsidiary of the controlling shareholder Kaisheng Technology Group Co., Ltd., for 104.1345 million yuan.
According to the announcement, Taihu Quartz is a national quartz sand high-tech enterprise integrating mining and beneficiation, research and development, processing and sales, the main product is high-purity quartz sand, and has the core ability of natural quartz ore purification high-purity quartz sand technology. Since high-purity quartz sand is an important raw material required for photovoltaic crucibles, there are good market prospects, Taihu quartz pilot products in 2022 have been recognized by customers, and the new high-purity quartz sand project with an annual output of 5,000 tons since September 2022 is still under construction on the evaluation base date, and the current production line has been completed and put into operation, and has begun to achieve good economic benefits, and it is expected that the cumulative net profit in 2023-2025 will not be less than 45 million yuan.
Kaisheng Technology said that according to the company's development strategy, the company will be committed to the common development of the two major businesses of display materials and applied materials, with these two businesses as the center, carry out scientific and technological innovation and industrial chain integration, and build the company into an internationally competitive technology industry group. The acquired Taihu Quartz is an enterprise that transforms new technology achievements in the applied materials segment of Kaisheng Group. Taihu quartz 5000 tons of high-purity quartz sand project is currently in the period of strategic development opportunities, broad market prospects, and the company's high-purity silica can form a close industrial linkage, promote the company to further expand market share, improve the company's product competitiveness, and inject new vitality into the company's applied materials industry.
Acquired 70% equity interest in Kaisheng Base
Kaisheng Technology announced on the same day that the company intends to acquire 70% of the equity of Anhui Kaisheng Basic Material Technology Co., Ltd. held by the Academia Sinica of Kaisheng Group, the controlling shareholder, for 52.52926 million yuan.
It is understood that the high-performance hollow glass microbeads produced by Kaisheng substrate are a multi-functional inorganic non-metallic spherical material with micron-level hollow and inert gas, with lightweight, high strength, low thermal conductivity, dispersion, fluidity, good stability, as well as low oil absorption, insulation, self-lubrication, sound insulation, fire resistance, non-absorption, corrosion resistance and other excellent properties, widely used in aerospace, oil exploration, deep-sea exploration, electronic communications, civil blasting, transportation lightweight, high-end composite materials and other fields, the market prospect is good.
Kaisheng Technology said that this acquisition will help the company's application materials sector industry extension, and the company's spherical quartz powder, high-purity silica and other powder silicon-based materials can achieve good industrial synergy, expand to more market application fields, and inject new vitality into the applied materials industry of Kaisheng Technology.
Some investment projects have been postponed
On June 30, 2023, Kaisheng Technology held the 19th meeting of the 8th Board of Directors and the 10th meeting of the 8th Board of Supervisors, deliberated and passed the "Motion on the Extension of Some Fundraising and Investment Projects", combined with the actual construction of the fundraising and investment projects, and agreed to invest the company's non-public stock offering funds investment projects in 2022 without changing the implementation entity, the investment purpose of the raised funds and the investment scale. That is, the second phase of ultra-thin flexible glass (UTG) project and the Shenzhen Guoxian new display R&D and production base project will be postponed.
As of May 31, 2023, the use of funds raised from the private offering in 2022 is as follows:
According to the announcement, the second phase of the ultra-thin flexible glass (UTG) project has been completed, and some production line equipment will be installed in July. The project has been postponed, mainly because the market has not yet been released, and new processing technologies such as UTG original film one-time molding, UTG/UFG are continuing to develop, and the project will match the construction progress of all production capacity of the project according to market conditions and process progress. It is expected to reach predetermined use in December 2023.
The project of Shenzhen Guoxian New Display R&D and Production Base has been delayed, mainly due to the temporary control caused by logistics obstruction and the long time required to apply for tree felling certificates. Based on the above reasons and the future project work plan, it is expected to reach the scheduled state of use in December 2023.
Kaisheng Technology said that the postponement and adjustment of some fundraising and investment projects does not change or covertly change the use of the raised funds and harm the interests of the company's shareholders, will not have a substantial impact on the implementation of the fundraising and investment projects, will not have a significant adverse impact on the company's normal operation, and is in line with the company's long-term development plan.
About Kaisheng Technology
It is understood that Kaisheng Technology has two major business segments, namely display materials and application materials. Among them, spherical quartz powder is widely used in electronic packaging, 5G high-frequency high-speed copper clad laminate, special ceramics and other high-tech fields, the company as the main participant in the formulation of spherical quartz powder national standards, the product has been fully recognized by downstream users, and the market share has gradually increased.
Kaisheng Technology spherical quartz powder
The high-purity silica prepared by Kaisheng Technology synthesis method is mainly used for CMP for wafers, 5G and packaging materials for semiconductors, etc., and is widely used in semiconductors, photovoltaics, optics, optical fibers and other fields, and is one of the key raw materials for the production of high-end semiconductor devices.
The company invested and constructed an annual output of 5,000 tons of high-purity synthetic silica project raw materials from industrial silicon to prepare organosilane, through sol-gel method (Sol-Gel), the preparation of low-emission high-purity spherical nanoscale silica powder materials and micron-sized quartz particles, product purity up to 6N-7N, to meet different functional requirements, the product can be used in electronic grade silica sol, electronic packaging materials, semiconductor devices, photovoltaic crucibles, etc. High-purity quartz sand produced by purifying impurities from crystal raw materials, the purity of the product can reach more than 4N8, and the products are mainly used for quartz crucible raw materials for photovoltaics/semiconductors.
In addition, Kaisheng Technology announced on July 1 that the company's board of directors received a written resignation report from Ms. Ou Mulan, deputy general manager, on June 29, 2023. Ms. Ou Mulan resigned from the position of deputy general manager of the company due to work arrangement, and after her resignation, she still served as a director and general manager of Shenzhen Guoxian Technology Co., Ltd. and Bengbu Guoxian Technology Co., Ltd., subsidiaries of the company, and served as the general manager of the company's display materials sales center.
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