Fu Neng Shares (600483): Acquisition Of 10% Stake In Ningde Nuclear Power Or Annual Thickening Of 200 Million Yuan Profit

In August 2nd, fortune group (600483, SH) issued the "plan for issuing shares to buy assets and related transactions" (hereinafter referred to as the "plan"), the company intends to use the issue of shares to buy assets, to the transaction of the Fujian provincial energy Refco Group Ltd (hereinafter referred to as Fu Neng group) to buy its holding of Fujian Ningde Nuclear Power Co., Ltd. (hereinafter referred to as Ningde nuclear power) 10% stake.

The daily economic news reporter learned that Ningde nuclear power is mainly engaged in nuclear power business. At present, 4 nuclear power generating units have been put into operation, with a total installed capacity of 4 million 356 thousand kilowatts. In 2018, the total electricity consumption was 31 billion 732 million 440 thousand kwh.

The Ningde nuclear power financial data disclosed in the plan showed that the operating income in 2017 and 2018 was 9 billion 123 million yuan and 10 billion 243 million yuan respectively, and the net profit was 1 billion 648 million yuan and 2 billion 234 million yuan respectively, and the weighted average return on assets was 13.46% and 17.41% respectively.

Acquisition of 10% stake in Ningde nuclear power

"Daily economic news" reporter noted that the shares of Fuxin can buy shares of Ningde nuclear power, the rival Fang Weifu energy group, and the fortune group held 62.5% of the shares. Therefore, the equity transaction constitutes a connected transaction.

According to the interpretation of the plan, the purpose of the related transaction is to solve the problem of competition between the controlling shareholder and the listed company.

"Plan" revealed that in July 2014, the fortune group completed a major asset restructuring. In order to solve the problem of competition in the same industry, Fuxin group's controlling shareholder, Fuxin group, issued a letter of commitment to avoid competition in March 18, 2014. The commitment to deal with this transaction is: "in view of the participation of the electric power company, the group will be gradually injected the equity stake of the equity company into the listed company within three years after the full satisfaction of the following conditions: (1) after the completion of the reorganization, (2) the shares have been profitable for two consecutive years."

Fu Neng group gained 10% of Ningde nuclear power in 2009. The other two shareholders of Ningde nuclear power are China Guangdong Nuclear and Ningbo Nuclear Investment Co., Ltd. and Datang International Power Generation Co. The actual control of Ningde nuclear power is the SASAC of the State Council.

Ningde nuclear power accounts for half of Fujian's nuclear power industry.

Ningde nuclear power is mainly engaged in nuclear power business. Currently, it has 4 sets of 1 million 89 thousand kilowatt nuclear power generating units, with a total installed capacity of 4 million 356 thousand kilowatts, accounting for 50% of the installed capacity of Fujian nuclear power, accounting for 8.2% of the total installed capacity of Fujian power generating enterprises, accounting for 9.76% of the total installed nuclear power plants in the country.

According to public information, Ningde nuclear power in 2018 totaled 31 billion 732 million kwh. In 2018, Fujian's generating capacity was 246 billion 200 million kwh, of which nuclear power generated 62 billion 300 million kwh, accounting for 25.3%. Ningde nuclear power's electricity consumption accounts for 50.88% of Fujian's nuclear power generation.

According to the reporter's understanding, the CPR1000 technology adopted by Ningde nuclear power generating unit is the million kilowatt class pressurized water reactor nuclear power technology based on M310 technology.

According to the financial data of Ningde nuclear power disclosed in the plan, the operating income in 2017 and 2018 was 9 billion 123 million yuan and 10 billion 243 million yuan respectively, and the net profit was 1 billion 648 million yuan and 2 billion 234 million yuan respectively, and the weighted average return on assets was 13.46% and 17.41%.

Up to now, fortune's share price has not yet been disclosed. Fu Neng shares disclosed: "as of the signing date of this plan, the audit and evaluation of the underlying assets of the transaction has not yet been completed, and the pre assessment results and proposed pricing of the underlying assets have not yet been determined."

If the net profit of Ningde nuclear power company is calculated at 2 billion 234 million yuan in 2018, the acquisition will bring 223 million yuan profit to the company every year.