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A Back-Door Listing and Business Development are Main Reasons for Twins Group’s Acquisition of Jinxinnong

China Agriculture Report By CnAgri2018-05-30 09:41:22China Agriculture Report Print On May 21st, Jinxinnong announced that it planed to transfer a 29.9% stake to Jiangxi Twins, with the trading amount of 1.934 billion RMB.
Twins is China’s biggest hog feed producer. It has owned more 100 subsidiaries, with annual feed capacity of more 20 million MT. Twins’ feed sales in 2017 reached 9 million MT. Jinxinnong is mainly engaged in feed, hog farming and animal health. Of which Jinxinnong’s feed sales in 2017 were 0.77 million MT, hog production stood at 0.37 million heads, and the revenues of feed business accounted for 75%. Twins’ acquisition of Jinxinnong is mainly because of listing and business development.
Due to great fluctuations about operating revenues of Agro-pastoral industry and stricter management and control on IPO, no agro-pastoral company has been successfully listed for a year. Through acquisition, back-door listing is the only feasible way. 
Besides, the acquisition of Jinxinnong also conforms to the developmental strategy of Twins. Twins planned to achieve feed sales at 20 million MT within five years, hog production at 15 million heads and grain purchasing and storage at 16 million MT. Twins’ feed products have been selling to large pig farms; the sales of feed sold to large pig farms by Jinxinnnong have reached up to 65%. More importantly, Xinjinnong has acquired domestic famous breeder companies such as Henan Xinda, Fujian Yichun and Wuhan Tianzhong, and hog farming business is developing quickly. In 2017, Jinxinnong advanced the construction of hog farming projects in Tieli of Heilongjiang, Nanping of Fujian and Shixing of Guangdong, etc., and planned to build half-million-head farming projects in Xipign of Henan and Jinghan of Hubei. It is helpful for the goal of hog production at 2 million heads/year in the next three years.

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