Gelonghui, April 26, 丨 Nanxuan Holdings (01982.HK) announced that on April 26, 2024, Nanguan (an indirect wholly-owned subsidiary of the company) signed a joint venture agreement with Hebei Yuteng. The details (including) manage the joint venture to produce cashmere yarn in Vietnam.
According to the joint venture agreement, Nanguan and Hebei Yuteng must inject capital of 4.4 million US dollars and 3.6 million US dollars into the joint venture company on or before April 25, 2027 according to their respective shareholding ratios in the joint venture company, accounting for 55% and 45% of the joint venture's issued share capital, respectively.
A joint venture company is an investment holding company that has not operated any business since it was incorporated. According to the joint venture agreement, M.C. (Vietnam) will be incorporated in Vietnam as a direct wholly-owned subsidiary of the joint venture company (collectively referred to as a joint venture group). M.C. (Vietnam) will mainly be engaged in cashmere yarn production in Vietnam. The expected production capacity is 500 tons of cashmere yarn per year, and the goal is to fully start production within three years.
Establishing a joint venture with Hebei Yuteng will enable the Group to (i) utilize Hebei Yuteng's expertise in producing high-quality cashmere; (ii) share the risks and rewards of investing in cashmere yarn production in Vietnam on a proportional basis with Hebei Yuteng; and (iii) expand its scope of business in Vietnam and enhance its overall competitiveness and customer base in the industry.