(Yicai Global) Nov. 2 -- Listed Chinese herbal toothpaste player Yunnan Baiyao Group has released details of plans to acquire Yunnan Baiyao Holding.
The plans consist of the direct capital reduction in and acquisition of Baiyao Holding. Yunnan Baiyao Group intends to issue shares to the State-owned Assets Supervision and Administration Commission in its home province of Yunnan, as well as, New Huadu Industrial Group and Jiangsu Yuyue Science & Technology Development. It will exchange shares to acquire Baiyao Holding and achieve an overall listing.
Upon completion of the transaction, all assets, liabilities and other rights and obligations of Baiyao Holding will be inherited by the listed company. The estimated value of the underlying assets is CNY50.8 billion (USD7.3 billion).
Secondly, Baiyao Holding will repurchase part of its equity held by New Huadu and reduce registered capital to ensure that the number of shares held by the Yunan's SASAC and New Huadu is the same after the acquisition.
Baiyao Holding was the largest shareholder of Yunnan Baiyao with a 41.5 percent stake before the transaction while the Yunan SASAC and New Huadu become the largest shareholders of the listed company with 25.1 percent stakes after the transaction's close.
The other major shareholders are Yunnan Hehe Group with 8.2 percent, Ping An Insurance Group with 7.7 percent and Jiangsu Yuyue Science & Technology Development with 5.6 percent.
Baiyao Holding began its reform of mixed ownership in 2016 and brought on board shareholders New Huadu and Jiangsu Yuyue at the end of last year. This led to a structure with Yunnan's SASAC holding 45 percent, New Huadu holding 45 percent and Jiangsu Yuyue holding 10 percent.