Orinko(SH:688219) Jin Rong Jie·2025-12-26 02:54Core Viewpoint - The acquisition of 70% stake in Italian company OMIKRON by Huaitong New Materials is a significant step in the company's globalization strategy, enhancing its presence in the European market for modified materials [1][5]. Group 1: Acquisition Details - The acquisition amount will not exceed €25 million, with payments to OMIKRON's shareholders MICCA 22 S.R.L and INVESTAR S.R.L totaling up to €10.35 million for a 70% stake [2]. - The base transfer price is €20.7 million, with additional interest calculated at an annual rate of 3% from December 31, 2024, until the closing date [2]. - An additional performance incentive of up to €3 million will be paid if OMIKRON meets certain EBITDA targets from 2026 to 2028 [2]. Group 2: Financial Performance - Huaitong New Materials reported a revenue of ¥4.721 billion for the first three quarters of 2025, a year-on-year increase of 10.03%, and a net profit of ¥166 million, up 8.96% [2]. - The company generated a net cash flow from operating activities of ¥686 million, a significant increase of 64.15%, providing a solid financial foundation for the acquisition [2]. Group 3: OMIKRON Overview - OMIKRON, established in 2008, specializes in modified materials, including polypropylene composites and nylon composites, serving key markets in Europe such as automotive and home applications [3]. - The company is projected to achieve a revenue of €41.176 million and a net profit of €1.238 million in 2024, with total assets of €35.2116 million and net assets of €17.1143 million [3]. Group 4: Strategic Importance - The acquisition is a crucial part of Huaitong's international strategy, which emphasizes a "multi-base, small scale, Local For Local" approach to expand overseas [3][4]. - The company has already established a modified plastic factory in Thailand and a representative office in Vietnam, significantly increasing its overseas sales [4]. - The European market is critical for high-end modified materials, and the acquisition will allow Huaitong to enhance its local operations and customer service capabilities in Europe [4][5]. Group 5: Industry Context - The European market is becoming increasingly competitive due to tightening environmental regulations and rising demand for high-end manufacturing [5]. - The acquisition will help Huaitong navigate compliance barriers and strengthen its dual circulation operational framework, enhancing overall profitability and risk resilience [5][6].