It is reported that Zhengzhou Coal Industry and Electric Power will exchange CNY 1.1 billion worth of real estate assets with CNY 4.6 billion worth of coal assets from its controlling shareholder, Zhengzhou Coal Group in an asset restructuring.

The difference of CNY 3.5 billion will be made up for by the issue of about 350 million shares to Zhengzhou Coal Group at CNY 10.19 per share. After the completion of the transaction, Zhengzhou Coal Group stake in the listed company will rise from 52.62% to 63.11%.

The coal assets to be injected include a 100% stake in Baiping Coal a 51% stake in Xinzheng Coal & Electricity a 51% stake in Jiaoxue No.2 Mine and other related assets. The real estate assets which Zhengzhou Coal Group will obtain include an 87% stake in Zhengzhou Coal and Electricity Great Wall Real Estate Development Investment and a 51% stake in Zhengzhou Dingsheng Real Estate.

Zhengzhou Coal Group had 20 coal producing subsidiaries at end 2010, with total coal reserves of 1.598 billion tons and recoverable reserves of 880 million tons. In addition, Zhengzhou Coal will issue up to one billion shares to a maximum of nine designated investors in order to raise CNY 1.019 billion to upgrade the technology of its coal assets.

Zhengzhou Coal said Zhengzhou Coal Group plans to complete the overall listing of its coal assets.

(Sourced from yicai.com)