To Protect Cotton From &Nbsp; Huamao Shares To Buy Cotton Enterprises In Xinjiang.

In December 14th, Huamao stock and natural person Zhang Qihai jointly signed the "equity pfer agreement". Huamao shares intends to buy the latter, holding 35% stake in Korla Xinjiang Lihua cotton industry limited liability company, and the purchase price is 58 million 609 thousand and 400 yuan.

The announcement shows that the main products of Lihua cotton are lint, cottonseed, short pile, cottonseed oil and so on.

The company is directly under five branches and a branch company, and is owned by a wholly owned subsidiary.

It has nine domestic advanced cotton processing and production lines, and has more than 650 employees.

The company has the annual production capacity of 200 thousand tons of lint, 75 thousand tons of cottonseed meal and 22 thousand tons of cottonseed oil.

It is understood that as a typical textile enterprise in the eastern coastal area, cotton is the main raw material of Huamao stock. Its cost accounts for more than half of the company's production cost. Xinjiang, as a major province of the country's output, accounts for about 40% of the total output of the country, and its quality, uniformity and spinnability are all maintained at a high level.

However, Xinjiang's Lihua cotton industry is the beneficiaries of this year's high cotton price.

The announcement shows that in 2009, the net assets of Lihua cotton were 59 million 6 thousand and 100 yuan, the main business income was 101 million yuan, the operating profit was 9 million 380 thousand and 700 yuan, and the net profit was 23 million 88 thousand and 400 yuan.

In the first 8 months of this year, the net assets of the company increased to 133 million yuan. In the first 8 months of 2010, the main business revenue was 599 million yuan, with a net profit of 84 million 168 thousand and 100 yuan.

Huamao shares said that from the development status of China's textile industry, the supply of raw cotton market is less than the demand, and the supply and demand is seriously unbalanced, and this situation is not expected to be solved in a long time. The 35% stake of the pferee cotton company is aimed at building a stable strategic partnership on resources, stabilizing the demand for high-quality cotton, and purchasing sufficient and reliable raw cotton to implement the company's main development strategy, and further improving the industrial chain of the main textile industry of the company.