Lutianhua Strengthens Presence in Coal Chemical Business     

Sichuan Lutianhua Co., Ltd. (Lutianhua, SZ: 000912), a leading urea producer in China, announced on December 24th, 2008 to purchase 40 million shares in Sichuan Luyuan Alcohol Co., Ltd. (Luyuan) and 3 million shares in Inner Mongolia Tianhe Chemical Co., Ltd. (Tianhe) at a combined consideration of RMB67 million.
   The completion of the transactions will make Lutianhua increase its share equity in Luyuan to 49.23% from 36.92%, and that in Tianhe to 28%. Along with Luyuan currently holding a 30% interest in Tianhe, Lutianhua would hold 42.77% equity in Tianhe.
   Luyuan has a capacity of 400 thousand t/a methanol and 150 thousand t/a dimethyl ether in Sichuan province. Tianhe is conducting a trial run on a 200 thousand t/a dimethyl ether facility in Bayanzhuoer, Inner Mongolia.
   With the acquisitions, Lutianhua intends to strengthen presence in coal chemical business as the current economic situation has brought tremendous pressure on domestic fertilizer producers never seen in history. Lutianhua hopes to raise its profit-making ability by the acquisition.
   Lutianhua, located in Luzhou of Sichuan province, engages in the production and sales of fertilizers, Sichuan Chemical Holding (Group) Co., Ltd., the majority shareholder of Lutianhua, holds 49.23% equity in Luyuan.