Levima Advanced Materials Corporation A Shares Listed on Stock Exchange Legend Holdings Cultivated Leading Enterprise in Advanced Material Industry



From right to left: Ning Min, Chairman of Legend Holdings; Suo Jishuan, Chairman of CAS Holdings; Zheng Yueming, Chairman of Levima Advanced Materials; Zhang Tao, Vice President and party member of the Chinese Academy of Sciences; Li Feng, Secretary of the CPC Zaozhuang Municipal Committee and Director of the Standing Committee of the Municipal People's Congress; Liu Wenqiang, Secretary of Tengzhou Municipal Committee Party

On the morning of December 8, Levima Advanced Materials Corporation (“Levima Advanced Materials”, Stock Code: 003022. SZ) was officially listed on the SME Board of Shenzhen Stock Exchange. Levima Advanced Materials has issued 147.36 million shares at an issue price of RMB11.46 per share. On the day of listing, the stock price rose 44% to RMB16.5 per share, with a market value of RMB16.95 billion. After listing, Legend Holdings Co., Ltd. (“Legend Holdings”, Stock Code: 3396.HK) held 51.77% of the equity interest of Levima Advanced Materials.

The successful listing of Levima Advanced Materials is another achievement of Legend Holdings’ industrial investment in promoting the industrialization of scientific and technology and development of the real economy through capital.

After ten years of hard work, Legend Holdings has once again made new achievements in industrial investment

Levima Advanced Materials is a high-tech enterprise engaged in the research and development, manufacturing and sales of advanced polymer materials and specialty chemicals. Before its establishment, Legend Holdings has begun exploring new areas to help the country solving the problem of high dependence on importing some high-end materials. In 2010, starting from Greenfield Investment, Legend Holdings contributed to the rapid growth of Levima Advanced Materials through capital and resource investment, management and cultural empowerment; In 2014, Levima project was completed and put into operation, setting the fastest record of similar device construction in the industry; In 2017, Levima Advanced Materials introduced the Chinese Academy of Sciences Holdings Co., Ltd. ("CAS Holdings") as a strategic investor. At present, Levima Advanced Materials has grown into a modern high-tech advanced material enterprise with annual sales revenue of nearly RMB6 billion. According to the prospectus, in 2017, 2018, 2019 and January-September 2020, the net profits of Levima Advanced Materials attributable to shareholders of the parent company were RMB55.1972 million, RMB229 million, RMB532 million and RMB423 million, respectively, maintaining a consecutive rapid growth. During the pandemic, Levima Advanced Materials maintained stable production and operation. Its profit in the first half of 2020 was basically the same as the period of last year, demonstrating strong ability to resist risks.

Legend Holdings stated: "Listing is the key milestone in the business development of Levima Advanced Materials, and it is also another achievement of Legend Holdings in building a leading company in the technological and industrial fields. Spending ten years’ time to cultivate a listed advanced material company requires long-term visions, capabilities, and determination. The development strategy of Levima Advanced Materials in the field of advanced materials highly synchronized with the long-term layout of Legend Holdings in the field of technology. There will be room for imagination and development in the future, continuing to support its growth. Legend Holdings hopes that with more cases, the vision of ‘Industry Serve the Country’ can be constantly fulfilled and create greater economic and social values."

Innovation-driven: Representative examples of industrialization of scientific and technological breakthroughs

Levima Advanced Materials has built an olefin-deep-processing industrial chain with methanol as the main raw material to produce high value-added products. It operates a number of advanced units, such as methanol to olefin (DMTO), ethylene-vinyl acetate (EVA), polypropylene (PP), ethylene oxide (EO), ethylene oxide derivatives (EOD), etc., and its production and operation level is in a leading position in the industry, among which the leading DMTO unit is the first million-ton methanol to olefin and olefin separation integrated unit with wholly independent intellectual property rights in China.

Methanol to Olefin (DMTO) Unit

As of July 30, 2020, Levima Advanced Materials has obtained 42 authorized patents, including 23 authorized invention patents. It has also hosted and participated in the formulation of 13 national and industrial standards, and successively undertaken 863 Plan of the Ministry of Science and Technology of the PRC and major scientific and technological innovation projects of Shandong Province, building a number of high-level innovation platforms.

Zhang Tao, vice president and party member of the Chinese Academy of Sciences, is in the view of that, taking innovation as the driving force for development, Levima Advanced Materials has successfully achieved the industrialized commercial operation of methanol-to-olefins technology under the independent intellectual property rights of Dalian Institute of Chemical Physics, Chinese Academy of Sciences, and explored the innovative "3+1" operation mode of "Alliance for Technology Innovation and Industrialization, Industrial scale platform, and Industrial Investment fund" and the professional achievement transformation operation team. The Company has achieved remarkable results, which is of typical demonstration significance for the scientific and technological achievements transformation and industrial scale development in China.

Continue to enhance core competitiveness to create an advanced material industry cluster

In the field of advanced polymer materials and specialty chemicals, Levima Advanced Materials' EVA, PP, EO and EOD products can be widely used in photovoltaics, cables, shoe material, plastic, daily chemical, textile, construction, roads, bridge, automobile, leather, coating, agricultural chemical, metal processing and other fields. High-end PP thin-walled injection molding material, EVA cable material and other products are in the leading position in the market segmentation; In the field of daily chemical and textile, the Company has been recognized by leading downstream companies such as Liby, Nice, and Blue Moon; In the fields of metal processing, pesticides and coating, a variety of products have achieved import substitution; In the fields of construction and roads and bridges, its series of concrete admixtures are in the leading position in China.

Levima Advanced Materials has raised about RMB1.61 billion, which will be used for the construction of a 100,000 tons/year by-product of carbon four and carbon five comprehensive utilization and olefin separation system supporting technical transformation project, EVA device tubular tail technology upgrade project, 65,000 tons/year special fine chemicals projects, etc. After the fund-raising projects are completed and put into production, the Company's production capacity will be substantially increased, thus profitability will be further enhanced.

Levima Advanced Materials stated: "The listing of Levima will provide new growth drivers for the Company to achieve leapfrog development in the future. The Company will firmly seize the historic opportunity of China’s industrial upgrading and consumption upgrading, adhere to the development model of "innovation-driven + operation promotion", focus on the field of new materials, constantly enhance independent innovation capabilities, continuously improve core competitiveness, and cultivate leading industrial cluster in several subdivisions of advanced materials.”

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