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JunHe Advises COFCO Biochemical (Anhui) Co., Ltd. on its Share Issuance for Overseas Asset Acquisition


On October 22, 2018, COFCO Biochemical (Anhui) Co., Ltd. (Stock Code: 000930, “COFCO Biochemical”) obtained approval from the China Securities Regulatory Commission for its public offering of shares, with the aim of acquiring a 100 percent stake in COFCO Biofuel Holdings Limited (“Biofuel Holdco”), COFCO Biochemical Holdings Limited (“Biochemical Holdco”) and Widepower Investments Limited (“Widepower”) from COFCO Bio-chemical Investment Co., Ltd. (“Biochemical Investment”), as part of a major restructuring exercise.  On December 18, 2018, COFCO Biochemical announced the closing of this asset acquisition and the registration and public offering of new shares.

COFCO Biochemical is one of the leading agricultural product processing enterprises in China, and a national leading enterprise for agricultural industrialization.  The company was founded on August 28, 1998 and has its headquarters in Bengbu, Anhui.  The company’s main products include fuel ethanol, citric acid and its salts, L-lactic acid, oil, corn protein feed, bio-fermented feed and DDGS.  The target companies under this major restructuring project are highly synergistic in business with COFCO Biochemical.  Through this project, COFCO will streamline its corn fine processing business to the listing platform operated by COFCO Biochemical, eliminating the horizontal competition among different segments of COFCO, which will create and realize synergy, optimize incentive mechanisms and improve operation efficiency.

Acting as the legal counsel for COFCO Biochemical, JunHe provided a full range of legal services across many jurisdictions, assisting COFCO Biochemical with the deal structuring, due diligence, the drafting of transaction documents and announcements, the preparation of application documents, responding to regulatory comments and opinions, acquisition closing and post-closing review.

This project involved cross-border share swaps of state-controlled listed companies.  Therefore, in addition to the review by the Stock Exchange and the CSRC, there were complex requirements to complete the approval, evaluation and filing. These involved numerous relevant state-owned assets supervisory and administration authorities, such as an anti-monopoly review by the Anti-Monopoly Bureau of the State Administration for Market Regulation, filing with the National Development and Reform Commission, undertaking the filing process for an outbound investment project with MOFCOM, MOFCOM’s approval for strategic investments in listed companies by a foreign investor, and other approval and permission procedures with various state authorities.  JunHe participated in the application designs and solutions with respect to these approval and permitting processes, communicated with the relevant authorities, prepared and submitted application materials, and assisted COFCO Biochemical to successfully complete all regulatory clearances.  JunHe’s lawyers were highly recognized by the client and other intermediaries for their efficient and prudent delivery of professional expertise, service and skills in governmental communications.

JunHe’s team in this deal was led by partner Mr. ZHAO, Xiyong (Sammuel) and assisted by partner Mr. WANG, Yahui.  Ms. CHEN, Xiaohua (Sara) and Mr. WANG, Xiaojun provided important support and guidance to this project.

JunHe is the only Chinese law firm to be admitted as a member of Lex Mundi and Multilaw, two international networks of independent law firms. JunHe and selected top law firms in major European and Asian jurisdictions are “best friends.” Through these connections, we provide high quality legal services to clients doing business throughout the world.