Taiyuan Coal Gasification Group

Taiyuan Coal Gasification Group

Taiyuan Coal Gasification Corporation (Chinese: 太原煤炭气化总公司) was incorporated in 1981. In 1998 it was re-incorporated as a limited company as Taiyuan Coal Gasification (Group) Co., Ltd. under the new Company Law of China, with China Cinda Asset Management and China Huarong Asset Management became minority shareholders due to debt-to-equity swap. A subsidiary Taiyuan Coal Gasification Co., Ltd. was also incorporated on 22 December 1998, receiving a coal mine in Jialequan, Gujiao (Chinese: 嘉乐泉煤矿), a coal preparation plant (Chinese: 晋阳选煤厂) in the Wanbailin District, Taiyuan and a coking factory from the parent company, and became a publicly traded company (on Shenzhen Stock Exchange) in 2000. Taiyuan Coal Gasification Group retained an old coal gas factory and a coal mine (Chinese: 长沟煤矿) which produces low grade thermal coal with sulfur content >2% at that time. The group later sold several more assets to the public company. Although the group also bought back the coking factories in 2013 as they were forced to close down by the urban renewal of Taiyuan in 2012.

After a heavy net loss in 2015, all of the assets and liabilities of the listed company (mostly coal mines and other equity investments) would be sold back to the parent company in 2016, in order to allow Jincheng Anthracite Mining Group to backdoor listing a subsidiary in the stock exchange.

Taiyuan Coal Gasification Group also acquired Shanxi Shenlong Energy Coking Co., Ltd.(Chinese: 山西神龙能源焦化), a coking factory and the coal gas provider in Jinzhong in 2011, for CN¥301 million. Xuangang (a subsidiary of Tangsteel Group), the second largest shareholder of Shenlong Energy Coking, had invited company to make an offer for their 33.21% stake in 2007, for a base price of CN¥28.905 million.

Taiyuan Coal Gasification Company

Taiyuan Coal Gasification Co., Ltd. (Chinese: 太原煤气化股份有限公司) was incorporated on 22 December 1998 as Shanxi Shenzhou Coal Electricity Coking Co., Ltd. (Chinese: 山西神州煤电焦化股份有限公司), which produces coal and coke at that time. The capital raised by IPO was used to build a coal gas factory complex (Chinese: 太原城市煤气工程气源厂) as well as acquiring three additional coal mines: Luyukou (Chinese: 炉峪口), Donghe (Chinese: 东河, the group acquired it in 1999) from the parent company and Lishi (Chinese: 离石) from Shanxi Top Energy for CN¥64.37 million; The coal gas factory complex was a joint venture between the parent company and the listed company in a 53–47 ratio, which the parent company had leased their portion to the listed company in 2004 for CN¥78.60 million per year. The deal was renewed for a year in 2006. In 2007, the listed company acquired the factory from the parent company (The factory was also known as the number 2 coking factory (Chinese: 第二焦化厂), which coal gas was the by-product from producing coke) for CN¥516.3366 million, with the price of the land lease was converted to new shares. The listed company also acquired coal preparation plants (Chinese: 选/洗煤厂) in Lishi and Donghe from the parent company in 2006 (for CN¥37.9899 million) and 2007 (for CN¥29.1998 million). In 2008 a coal gangue thermal power station (Chinese: 煤矸石热电厂) was acquired from the parent company for CN¥222.1125 million.

In August 2012, the coal gangue thermal power station and the number 2 coking factory of the listed company were closed down due to urban renewal policy of Taiyuan. The number 1 coking factory had closed down in April 2012. Partially due to the closing down, the revenue of the company had decreased from CN¥3.8 billion in 2011 to CN¥3.3 billion in 2012, as the company no longer produce coke. In 2013 the listed company invested in a local railway company for CN¥309.2 million. In the same year the closed coking factories were sold back to the parent company for CN¥1.780 billion. Due to the fall in price of coal, and the closing of the coal preparation plant in the Wanbailin District (Chinese: 晋阳选煤厂), the revenue of the listed company had dropped even further to CN¥2.086 billion in 2013, CN¥1.724 billion in 2014 and CN¥1.655 billion in 2015. The net assets of the listed company were also decreased from CN¥2.763 billion in 2013 to just CN¥215.881 million in 2015.

As at 31 December 2015, despite the listed company retained the name "coal gasification", the listed company only produce coal as their product, which sold coal to Benxi Steel Group, Shandong Iron and Steel Company, Tangshan Yanshan Iron and Steel (Chinese: 唐山燕山钢铁), as well as sold to sister company Shanxi Shenlong Energy Coking as their top 4 customers (36.34% of the sales volume).

In 2016, a plan to sell all of the assets and liabilities at 31 January 2016 of the listed company to Taiyuan Coal Gasification Group was announced. At the same time the shell company would be used as a backdoor listing of a subsidiary of Jincheng Anthracite Mining Group (JAMG). JAMG already acquired 24.26% stake of the listed company from Taiyuan Coal Gasification Group before the finalization of the backdoor listing.

Subsidiaries

Shareholders

In 2008 China National Coal Group (China Coal Group) was the largest shareholder of Taiyuan Coal Gasification Group. China Coal Group excluded Taiyuan Coal Gasification Group from injecting to listed company China Coal Energy due to Taiyuan Coal Gasification Group has provide coal gas to citizen in not-for-profit basis, as well as half the stake was held by other state-owned enterprise. China Coal Group later acquired 3.9% stake from China Cinda to become the controlling shareholder, but in 2013 16.18% stake was transferred to State-owned Assets Supervision and Administration Commission (SASAC) of Shanxi Provincial People's Government, making Shanxi SASAC became the largest shareholder, jumping from the second.

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