WCC West China

 

TIDMWCC 
 
RNS Number : 0810F 
West China Cement Limited 
06 January 2010 
 

West China Cement Limited ("WCC") 
 
 
Announcement of Xiushan Acquisition 
 
 
6 January 2010 
 
 
West China Cement Limited ("WCC") is delighted to announce the acquisition of a 
100% shareholding of Shaanxi Xiushan Cement (Group) Limited Company, for a 
consideration of Rmb 180 million, to be met from WCC's resources. This comprises 
the Xiushan cement plant, situated in Zhen'an County, Shaanxi Province, about 90 
kilometres North of WCC's Ankang plant and 150 kilometres South-West of its 
Lantian plant; and the Xunyang Xiushanlong Cement milling facility 10 kilometres 
from Ankang. 
 
 
The Xiushan cement plant has a capacity of 600,000 tonnes per annum and 
limestone reserves to support this operation for at least 30 years. It uses 
modern NCPP technology, but WCC expects to modify the plant in due course to 
improve operating efficiency, environmental performance and output. 
 
 
The Xiushanlong milling plant has the capacity to mill approximately 100,000 
tonnes of clinker or slag, which can then be blended with Ankang's production. 
Xiushan achieved a Pre-tax Profit of Rmb 23.8 million in 2008.In terms of the 
agreement, profits from Xiushan accrue to WCC with effect from August 2009. 
 
 
Commenting on the transaction, Jimin Zhang, WCC's Chief Executive Officer, said: 
 
 
"Xuishan offers an excellent opportunity to improve our service to the cement 
market in the South-East of the province. This furthers our strategy of 
achieving strong local market positions. The milling plant also gives us the 
capacity to produce slag cement, allowing us to offer a range of blended cements 
which has technical benefits and should be useful in several of the large 
hydro-electric and railway projects in the area." 
 
 
WCC's Chairman Robbie Robertson remarked: 
 
 
"This acquisition is exciting in itself, but also because it is our first 
acquisition. I said at the time of the half year results that our continued 
growth would come not only from new capacity but also from acquisitions. This is 
the first step. 
 
 
With it our capacity will reach 8 million tonnes during the course of next year, 
which is the bottom of our declared 8-10 million target for 2010." 
 
 
 
 
For further information, please contact: 
West China Cement Limited 
Po Ling Low Tel: +86 139 1088 6649 
 
 
NCB Stockbrokers Ltd 
Christopher Caldwell Tel: + 44 20 7071 5200 
 
 
Citigate Dewe Rogerson Asia 
Pui Shan Lee Tel: + 86 21 6340 4186 / Mob: + 86 138 1712 5781 
ps.lee@citigate.com.cn 
 
 
 
 
Notes to Editors: 
 
 
West China Cement listed on the AIM market of the London Stock Exchange on 4 
December 2006, raising approximately GBP20.1 million net of expenses. 
 
 
Prior to the listing, the Company, which is headquartered in Xi'an the 
provincial capital of Shaanxi Province, had operated three cement production 
plants in Pucheng with a combined production capacity of 1.5 million tonnes per 
annum since 2003. 
 
 
In order to service the growing demand for cement in the region, a new plant 
running two cement production lines, funded by money raised at the IPO, opened 
in Lantian in 2007 and has a production capacity of 2 million tonnes. 
 
 
On 29 May 2008, the Company entered into a US$60 million loan agreement with 
Warrants to finance the third production plant. This 1.8 million tonne plant at 
Ankang started producing and selling cement in March 2009 and is expected to 
reach full capacity in the second half of 2009. 
 
 
Approval for the building of two new cement plants, Yangxian and Mianxian, each 
with a capacity of 1 million tonnes per annum, was announced in March 2009. With 
the massive government spend on infrastructure as part of the RMB 4 trillion 
fiscal stimulus package and the need to rebuild in the wake of the Sichuan 
earthquake which occurred in this area, the Company has chosen the appropriate 
location to build these latest projects. 
 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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