Shuifa Gas Buys Shengdong Gas; Energy Service Expand.
Shuifa Gas (603318) announced on the evening of September 11th that the company plans to acquire 100% equity of Shengdong Gas held by Shengdong Group in cash, with a transaction price of 346 million yuan, and the acquisition funds are from the company's own and self-raised funds. After the completion of this transaction, Shengdong Gas will be included in the company's consolidated financial statements.
The controlling shareholder of Shengdong Group, Dongying Shengdong Equity Investment Partnership (Limited Partnership) (hereinafter referred to as "Shengdong Partnership"), is an associated enterprise with a 29.9252% capital contribution ratio held by the listed company. At the same time, the executive affairs partner of Shengdong Partnership is Shuifa Gas Group Co., Ltd. (hereinafter referred to as "Gas Group"), and Gas Group is a wholly-owned subsidiary of the indirect controlling shareholder of the listed company, Shuifa Group Co., Ltd. Therefore, Shengdong Group is an associated party of the company. This transaction constitutes a related party transaction and does not constitute a significant asset restructuring.
Shengdong Gas is a distributed energy comprehensive service provider integrated with investment, construction, and operation, focusing on the comprehensive development and utilization of combustible gases and comprehensive energy services under Shengdong Group. Shengdong Gas is mainly engaged in the comprehensive utilization of combustible gases, including providing low-concentration gas power generation operation and maintenance services for coal mine enterprises, leasing and selling power generation equipment, and cooperative station construction, etc.
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As of now, Shengdong Gas has a total of 54 power stations in operation, with a total of 408 units and a total installed capacity of 282.2MW, of which: 10 cooperative stations with 79 units and an installed capacity of 52.6MW; 44 guaranteed operation stations with 329 units and an installed capacity of 229.6MW.
In 2023, Shengdong Gas achieved a business income of 127 million yuan, with a net profit of 27.129 million yuan; from January to March 2024, it achieved a business income of 35.1509 million yuan, with a net profit of 4.4396 million yuan.
According to the announcement by Shuifa Gas, the net asset book value of Shengdong Gas as of the appraisal base date is 122 million yuan, and the appraised value of the shareholders' equity is 346 million yuan, with an appraisal increase of 224 million yuan, an appreciation rate of 183.97%.
Shengdong Group promises that the net profit of Shengdong Gas in 2024, 2025, and 2026 will not be less than 26.4727 million yuan, 28.7751 million yuan, and 30.4959 million yuan, respectively, with a cumulative promised net profit of not less than 85.7437 million yuan.
Since the reorganization in 2019, Shuifa Gas has transformed from a privately-owned listed company to a state-owned listed company controlled by the Shandong Provincial State-owned Assets Supervision and Administration Commission. After the change of ownership, Shuifa Gas has been continuously exploring upstream and downstream businesses, and the company has now completed a full industry chain layout from upstream liquefied natural gas production, to midstream high-end manufacturing mainly in gas equipment, and then to downstream gas application fields such as distributed energy and urban gas supply.
After this acquisition of Shengdong Gas, Shuifa Gas can use its advantages in the natural gas market to guide Shengdong Gas to further expand from the original low-concentration gas power generation services for coal mine enterprises to the field of natural gas power generation or urban gas operation, opening up new market space and bringing profit growth to the company.
In terms of business collaboration, the business model of Shuifa Gas and Shengdong Gas in the field of distributed energy is highly similar, with a solid foundation for cooperation. After acquiring Shengdong Gas, Shuifa Gas can further consolidate and expand its market share in the field of distributed energy, and at the same time, learn from Shengdong Gas's rich experience in low-concentration gas power station operation and energy-saving services to improve its own service quality and efficiency.In terms of operational collaboration, due to the rich industry experience and professional talent that Shui Fa Gas and Sheng Dong Gas possess in their respective fields, there is a certain degree of overlap in the projects they undertake, thus enabling the formation of an efficient collaborative mechanism.
Shui Fa Gas stated that this transaction will enable the company to effectively fill the gaps in its distributed business in the short term, fully integrate advantageous resources, and leverage the revenue, business, and operational synergies with Sheng Dong Gas, creating new profit growth points for the company. Upon completion of this transaction, Sheng Dong Gas will become a wholly-owned subsidiary of the company, which will help the company to further explore the market.
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