OM Holdings has informed that its wholly owned subsidiary, OM Materials (S) Pte. Ltd. has executed a Share Sale
Agreement for the sale of its 90% equity interest in OM Materials (Qinzhou) Co Ltd to Beijing Kunpeng Hongsheng Metal Co. Ltd.
Beijing Kunpeng Hongsheng Metal is an established company involved in the trading of ores and alloys in China. OMS will retain a 10% interest in OMQ.
Under the terms of the Share Sale Agreement, the consideration payable by Beijing Kunpeng Hongsheng Metal to OMS is RMB182.6 million (approximately USD25.0 million). OM Holdings said the proceeds from the sale will be used partly for working capital needs and the capital expenditure of the OMH Group.
The Board said it believes the sale of OMQ’s equity interest will unlock value for the Company and allow the redeployment of capital to OMH’s core business operations. Upon completion, the Company’s interest in OMQ will be 10% and Beijing Kunpeng Hongsheng Metal’s interest will be 90%. The Company will retain a strategic relationship with the new entity, and continue to provide marketing and procurement services.
