Lianyang Intelligent Holdings (01561) announced that on November 16, 2023, Wanhui Chemical, a wholly-owned subsidiary of the company, has...
According to the Zhitong Finance App, Lianyang Intelligent Holdings (01561) announced that on November 16, 2023, Wanhui Chemical Co., Ltd., a wholly-owned subsidiary of the company, acquired 40% of Changzhou Wanhui's shares from Teknos Group Oy at a cash cost of RMB 10.5 million. The acquisition was completed on the same day.
On November 16, 2023, the buyer entered into a settlement agreement with the seller to resolve all disputes relating to the repurchase of shares. The acquisition forms part of the settlement between the contracting parties. On November 22, 2023, the Shanghai International Arbitration Center issued a dismissal decision rejecting the arbitration proposed by the seller.
The announcement stated that the acquisition was carried out to avoid potentially lengthy arbitration procedures and the costs and uncertainties associated with them. Arbitration is usually a long and time-consuming process that consumes a lot of resources in terms of management time and money. Furthermore, there is always uncertainty about the outcome of arbitration, which may be unfavorable to the group.
As part of the settlement, the acquisition will provide a final resolution to the dispute. It would not only eliminate the need for further arbitration, but also eliminate the risk of obtaining an adverse arbitration decision. The settlement also enabled the Group to focus its resources on its core business rather than on resolving legal disputes.
The acquisition also brought the added benefit of gaining absolute control over Changzhou Wanhui. With this absolute control, the group will have the power to guide the operation and management of Changzhou Wanhui to make it more consistent with the group's goals.
Furthermore, gaining absolute control will help simplify decision-making and improve operational efficiency, since the group will no longer need to consult or negotiate with sellers. This move can improve Changzhou Wanhui's decision-making and management, thereby improving overall performance. The move also enabled the Group to fully integrate Changzhou Wanhui into its overall investment portfolio, thereby unlocking synergies and creating value for stakeholders.