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Statement |
1.Date of occurrence of the event:2010/12/20
2.Counterparty to the contract or commitment:
Sinopec Yizheng Chemical Fibre Company Limited (YCF)
and Yangzhou Chemical Industrial Park
3.Relationship to the Company:Nil
4.Starting and ending dates (or rescission date) of the
contract or commitment:2010/12/20
5.Major content (not applicable where rescinded):
Far Eastern New Century Corporation (FENC) and
Sinopec Yizheng Chemical Fibre Company Limited (YCF)
have agreed to form a joint-venture company to construct
a green-field purified terepthatic acid (PTA) plant
located in the Yangzhou Chemical Industrial Park.Three
parties aforesaid have signed a “Letter of Intent (LOI)”
on 20 December 2010.
FENC had accomplished vertically-integrated production
lines for its polyester business in Taiwan and mainland
China, from upstream petrochemical plants to downstream
plants for packaging materials and textile products,
comprising of polyester chips, yarn spinning, dyeing and
finishing, apparels, and garments. In recent years, FENC
has been actively expanding its business scope, and
accelerating its R&D efforts and production capacity in
high-value added products. Last year, FENC launched a
five-year plan, the ambition of which is to double its
revenue through capacity expansions. YCF, a listed
company on the Stock Exchange of Hong Kong Limited and
the Shanghai Stock Exchange, is the second largest
polyester producer in mainland China, belonging to China
Petrochemical Corporation (Sinopec Group). YCF has been
granted a license to construct a PTA plant with an annual
capacity of 1 million tons by the National Development and
Reform Commission of the Beijing authority. The total
invested capital is estimated to be RMB 3.8 billion.
With the assistance and encouragement from Yangzhou
Municipal Government and Yangzhou Chemical Industrial Park,
FENC and YCF therefore decided to cooperate to construct
the said PTA plant in the Yangzhou Chemical Industrial Park,
in order to meet the increasing demand for PTA from both
companies.
Subsequent to the signing of “LOI”, FENC will start the
discussion with YCF regarding to the details of the
cooperation; meanwhile, apply for approval from the
Investment Commission, MoEA (Taiwan) for this investment
in China. A joint–venture company, 60% held by FENC while
YCF holding the remaining 40%, will be created by both
parties to construct the PTA plant. With the full support
that the Yangzhou Municipal Government has promised,
we therefore believe that this investment project will be
carried out well and smoothly.
6.Restrictive covenants (not applicable where rescinded):Nil
7.Effect on company finances and business (not applicable where rescinded):Nil
8.Concrete purpose/objective (not applicable where rescinded):
To meet the increasing demand for PTA
9.Any other matters that need to be specified:NA
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