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Joyou acquires galvanization plant in China

(PresseBox) (Hamburg, ) Joyou AG, a leading manufacturer of bathroom, kitchen and other faucets and a specialist in other sanitary ware products in China, intends to acquire a 100% stake in Yongsheng Galvanization Industrial Co. Ltd., a galvanization plant in the Shui Tou Galvanisation Industry Park in Nan?an, Fujian Province. The acquisition has been approved by the supervisory board and is expected to be completed within 1 month. The total investment volume of the acquisition amounts to EUR 12.2 million (RMB 106 million). As planned, Joyou will therewith invest parts of the proceeds of its IPO in order to expand the capacity of its existing galvanization lines.

The galvanization plant, Quanzhou Yongsheng Galvanization Industrial Co. Ltd. was established in March 2010 in the Shui Tou Galvanisation Industrial Park and specializes in galvanization for international and domestic sanitary ware brands. Due to its increase in production, Joyou?s current galvanization capacities are insufficient to meet expected future demand. The Yongsheng plant currently has over 100 employees and a galvanisation capacity of some 45,625,000 pieces per year.

Additional information:

In response to the environmental impact of the Galvanisation Process, the PRC government has ceased issuing new galvanisation licenses and seriously curtailed expansion of current galvanisation lines. It was for this reason, that the 200,000 sqm Shui Tou Galvanisation Industry Park was established. It is a government controlled centralized galvanization facility set up to tackle environmental issues related to the galvanization process.

"It was due to this constraint, and that a Greenfield construction in the Shui Tou Galvanisation Industry Park was ruled out due to the facilities current capacity constraints, that Joyou AG intends to acquire the Yongsheng Galvanization Industrial Co. Ltd. thereby ensuring that it will have sufficient capacity to fulfil its future expansion plans", explains JOYOU CEO Jianshe Cai.