Juhua Group Spent USD196.18 Million (RMB1.2 Billion) Acquiring 25.67% of Shares in Zhejiang Feida

Date: 2015-09-08

“Zhejiang Juhua: pilotscale experiment of PTFE used in heat exchanger succeeds

On 5 Aug., 2015, Zhejiang Juhua Co., Ltd. (Zhejiang Juhua) announced the success in the pilotscale experiment of polytetrafluoro ethylene (PTFE) used in heat exchanger. The experiment showed that the performance indicators of the product were close to the international levels and can be used in the heat exchanger for the recycling of flue gas and waste heat in power plant.
Zhejiang Juhua also gave full play to the industrialisation devices under operation to carry out trial production of this product and launched a processing and application test for downstream heat exchanger.

Compared with metal heat exchanger, PTFE heat exchanger has higher corrosion and temperature resistance (about 250 ℃ the highest) and smaller flue gas resistance, since the distribution of tube bundles are parallel with flue pipes. Thanks to the smooth surface of tube bundles, it is not easy to collect dust and easy to clean. Its operation cycle and service life are longer and the comprehensive cost is lower. It can facilitate energy conservation and emission reduction.

Currently, the PTFE used in PTEF heat exchanger in China is mainly imported from other countries, according to Zhejiang Juhua. If the large-scale production and downstream processing and application are successful, Zhejiang Juhua will be capable to produce products to replace imported ones, which is of great significance to the improvement of economic effect.

Zhejiang Juhua has been dedicated to the R&D of new PTFE products for many years, including continuous PTFE fiber, uncontinuous PTFE fiber, perfluorooctanoic acid-free PTFE, PTFE used in heat exchanger, etc. CCM believes that, through optimisation and upgrading of the PTFE product structure, Zhejiang Juhua will hopefully develop premium PTFE products and explore new applications, so as to realise the differentiation competition and improve its performance.

In 2014, Zhejiang Juhua made the revenue of USD114.11 million (RMB698.03 million) from the fluoropolymer business, down by 2.55% compared with that of USD117.10 million (RMB716.29 million) in 2013, according to its full-year financial report. This was the only business with sales drop in 2014 amongst Zhejiang Juhua’s 4 major fluorochemical businesses (the others are fluorochemical raw materials, fluorine-enriched refrigerant and fluorine-enriched fine chemicals). The board of directors attributed it to the declined prices of fluoropolymer products due to the slower growth in domestic investment, the release of production capacity and the slower rise in demand.

As the newly developed PTFE product of Zhejiang Juhua is mainly used in environmental protection field, CCM believes that the development of this product is aimed at following the government policies and supporting its parent company, Juhua Group Corporation (Juhua Group) to develop environmental protection business.

In March 2015, the Ministry of Industry and Information Technology of the People’s Republic of China released the 2015 Implementation Scheme for the Specific Action to Improve the Industrial Basic Materials, which gave clear indication that key support would go to the development of PTFE fiber and filter material used in environmental protection field. Together with the Water Pollution Prevention and Control Action Plan and the Air Pollution Prevention and Control Action Plan, the government is continuously exerting efforts to guide the manufacturing industry to develop with goals of energy conservation, environmental protection and low carbon.

According to CCM research, Juhua Group has greatly developed the environmental protection business. In January 2015, it spent USD196.18 million (RMB1.2 billion) acquiring 25.67% of shares in Zhejiang Feida Environmental Science & Technology Co., Ltd. (Zhejiang Feida) and became its new majority shareholder.

In addition, Juhua Group also merged 100% equity of its subsidiaries involved in environmental protection business, Zhejiang Quzhou Jutai Building Material Co., Ltd. and Quzhou Qingtai Environmental Engineering Co., Ltd., into Zhejiang Feida, along with a working fund of USD147.13 million (RMB900 million), so as to set up main businesses in the fields like dust extraction and desulphurisation and denitration related to coal-fired power plant, and the treatment of industrial solid waste and sewage.”

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