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AsiaPhos undergoes internal restructuring

CATALIST-LISTED company AsiaPhos Limited is carrying out an internal restructuring, which will involve the assets, operations and activities of its subsidiaries in Singapore, Hong Kong and China, it announced on Monday.

The internal restructuring is to facilitate the reorganisation, streamlining and expansion of the group's downstream business segment, which consists of the production and sale of phosphorous and phosphate-based chemicals.

The phosphate-mining firm entered into an agreement with Norwest Chemicals, Sichuan Mianzhu and APC Limited, its own subsidiary incorporated in Hong Kong, on Friday, setting out the terms of the restructuring. Under the terms, Norwest Chemicals will acquire Sichuan Mianzhu and split its assets, operations and activities so that its downstream business will be undertaken by the new WOFE subsidiary of Norwest Chemicals. Upon completing the split, APC will buy over the entire equity interest of the new WOFE subsidiary.

When the internal restructuring is competed, Sichuan Mianzhu will continue to undertake the group's mining operations and activities in Sichuan.

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The exercise will be funded through internal resources of the group and is not expected to have any material impact on the earnings per share or net tangible assets per share of the group for the current financial year ending Dec 31, 2017.

In relation to the internal restructuring, the construction of a sodium hexametaphosphate (SHMP) plant, set out in the company's offer document of September 2013, will resume. The SHMP plant, with a capacity of up to 20,000 tonnes, is estimated to take about eight months to complete and will cost between 6 million renminbi (S$1.22 million) and 7 million renminbi.

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