Yiwei LiNeng plans to acquire 5% equity of Dahua Chemical Industry with 110 million yuan to speed up the development of boron and potash ore resources in Dachaidan Salt Lake.

Yiwei LiNeng (300014.SZ) announced that the company intends to sign an "equity transfer agreement" with Xinjiang Gengxin Lianchuang Equity Investment Co., Ltd. (referred to as "Gengxin Lianchuang"). The transfer price is 110 million yuan for the 5% equity of Da Chaidan Dahua Chemical Co., Ltd. (referred to as "Dahua Chemical") held by Gengxin Lianchuang.

It is reported that Dahua Chemical enjoys the mining right of Dachaidan Salt Lake, which covers an area of about 240square kilometers and an area of 89.7505 square kilometers. the mining types include boron ore, potash ore, lake salt, lithium and bromine.

In addition, the company's controlling shareholder, Tibet Yiwei Holdings Co., Ltd. (referred to as "Yiwei Holdings"), has obtained the mortgage of the above-mentioned boron and potash mining rights in Dachaidanhu (area A) and intends to acquire a 29% equity interest in Dahua Chemical Co., therefore, this transaction constitutes a related party transaction.

The announcement said that this transaction will help to integrate the advantageous resources of all parties, speed up the development of boron and potash ore resources in Dachaidan Salt Lake, and enhance the resource reserves and production capacity of Dahua Chemical Co., Ltd., which will further ensure the low-cost and high-quality lithium resources needed for the company's production and operation, reduce the adverse impact of raw material price fluctuations on the company, and help the company to further focus on the main lithium battery industry.