Ningde Times plans to transfer 10% of Tianyi Lithium Industry and purchase Yibin Libao more than 200000 tons of cathode materials.

After trading on March 16, Tianyuan (002386) issued an announcement saying that it would continue to promote the development of the new energy battery material industry in accordance with the development strategy. According to the conditions under which the company publicly listed and transferred its 10% stake in Yibin Tianyi Lithium Industry Science and Technology Co., Ltd., on March 16, 2021, Tianyuan shares, Ningde Times and Yibin Libao, an important shareholding subsidiary of the company, jointly signed the Comprehensive Strategic Cooperation Agreement (2021-2030) (referred to as the "Cooperation Agreement").

After the signing of the Cooperation Agreement, all parties will carry out comprehensive strategic cooperation in business, capital, research and development, and fully seize the huge opportunities for the development of the new energy industry chain. we will jointly promote the high-quality development of Yibin as an important lithium battery production base in the country.

In terms of business cooperation, under the same fair price in the market, Ningde era has agreed to give priority to purchasing not less than 200000 tons of cathode materials produced by Yibin Libao in the next ten years (2021-2030), not less than 15000 tons in 2021 and not less than 25000 tons in 2022. The specific contents and methods of cooperation shall be subject to the formal supply agreement signed by both parties.

At the level of capital cooperation, after the signing of the Cooperation Agreement, Ningde Times and Tianyuan shares jointly negotiated the cooperation of Yibin Libao and Yibin Guangyuan Lithium material Co., Ltd. and other supporting projects of lithium materials settled in Yibin in the future, so as to achieve in-depth equity cooperation.

In terms of R & D and industrialization, the three parties agreed to carry out in-depth cooperation in the fields of lithium cathode materials and precursors, and jointly set up a joint R & D team to jointly promote the formulation of national and industry standards for new materials, new products and new technologies.

Tianyuan shares said that the signing of the Cooperation Agreement will help to further deepen the cooperative relationship between the company and Ningde era and enhance the level and depth of cooperation. It is beneficial for the company and Yibin Libao to seize the development opportunity of Yibin to build lithium power industry cluster, speed up the development of new energy battery material industry, achieve sustained and stable growth in sales, and improve the market competitiveness of Yibin Libao products, which is in line with the company's future development strategy.

On the same day, Tianyuan shares also signed a property rights transaction contract with Ningde Times, intending to transfer a 10 per cent stake in Tianyi Lithium Industry to Ningde Times at a price of 58.35 million yuan.

Public data show that in early April 2018, Tianhua Chaojing planned to jointly invest in Tianyi Lithium Industry with Changjiang Morning Road (Hubei) New Energy Industry Investment Partnership (Limited Partnership), Ningde Times, Yibin Tianyuan Group, Ningbo Hanyi Investment Partnership (Limited Partnership), Ningbo Meishan bonded Port Chaoxing Investment Partnership (Limited Partnership) and other companies, with a registered capital of 700 million yuan. Among them, Tianhua ultra-net investment of 294 million yuan, accounting for 42%. In November of that year, Tianyi Lithium Industry was officially established, using lithium concentrate as raw material, mainly engaged in the R & D, production and sales of lithium battery materials and lithium series products and new energy-related chemical products.

At present, Tianhua Chaojing and Ningde era own 68% and 15% of Tianyi Lithium respectively, making them the top two major shareholders of the latter. Tianyuan shares hold a 10% stake in Tianyi Lithium Industry. After this equity transfer, Ningde era's contribution to Tianyi lithium industry will reach 25%.