(Yicai Global) Sept. 7 -- China's largest property developer, Evergrande Real Estate Group, has further diversified its business. A unit of the firm will invest about CNY144 million (USD21.4 million) to gain 35 percent of the equity of a graphene technology development company in Chongqing, southwestern China, and the veto right to the target's major business decisions.
Its subsidiary Chongqing Nanjiang Investment, and Chinese Academy of Sciences affiliate Chongqing Deling Technology have penned an agreement with Evergrande High-Tech Industry Chongqing to increase the latter's investment in Chongqing Moxi Science & Technology, their parent, A-share listed company Deluxe Family, announced yesterday.
Nanjiang Investment will hold 48.75 percent of the target company after the capital increase, down from 75 percent, but will remain the largest shareholder. Deling Technology's share will fall to 16.25 percent from 25 percent, the announcement said.
The future major business matters of the target company must be approved by more than two-thirds of shareholders, which means that Evergrande, with a 35 percent stake, will have the power to decide major business decisions. Its unit will fill three seats on the seven-member board, per the agreement.
The parties have also agreed to pay CNY10 million (USD1.49 million) each as commissioned research and development funds to the Chongqing Institute each year in the two years after the completion of the investment to enhance the target's graphene technology strength in combination with the scientific research capability of Chongqing Institute of Green and Intelligent Technology under CAS, the announcement added.
Chongqing Moxi is a start-up that researches, develops and produces on a large-scale production equipment and systematic solutions for graphene film. It also develops graphene film-based applied products. Those on the market include transparent graphene conductive films, graphene e-books, transparent graphene heating films, graphene skin rejuvenation instruments and those to treat bags under the eyes, according to the firm.
Editor: Ben Armour