Zhong De Securities has successfully closed Valiant Fine Chemicals Co., Ltd. (“Valiant”) RMB 1.028bn A-share private placement, in which ZDS was engaged as the sole sponsor institution and lead manager.

Valiant is a leading global fine chemicals subsidiary of China Energy Conservation and Environmental Protection Group, and its clients are mainly the big global brands. Valiant is the only vendor whose products are procured by three oligopolies of mixed crystal market, in which they represent more than 99% of the market share. Valiant in recent years made a quick entrance into zeolite materials sector, and became within a short time span the core supplier and key strategic partner as the world’s No. 1 automobile exhaust purification catalyst maker. Its business covers several other cutting-edge segments, including OLED, and pharmaceuticals.

Zhong De Securities successfully sponsored Valiant for SZSE IPO in 2011, and the private placement this time was Valiant’s first follow-on financing since its listing. Zhong De Securities took careful and pragmatic efforts for Valiant Fine Chemicals follow-on financing, through activities of deal planning, deal execution, regulatory talks, and investor communication. The deal plan attracted broad market interest upon announcement, which showcased high capital market recognition for this follow-on financing. The deal received quick and unconditional approval from the CSRC, an evidence of the ZDS project team service quality and its tight connection with the regulators.

ZDS arranged several rounds of roadshows after the CSRC approval, and Valiant private placement was watched very closely by the capital market. ZDS made a tight deal timetable, in which valid bids were received from 26 investors and the deal was oversubscribed 5.16 times. The final issuance price was set at CNY16/share, having a premium over the market close price upon the subscription cut-off (stock exchange morning close time). The issuance price has a 72.04% premium over the bottom-line ask price and only has a 2.62% discount from the subscription-day market close price. The deal helped the company maximizing the financing efficiency and was highly recognized by the Valiant management.

The private placement raised CNY1.028 bn for Valiant’s Phase II expansion project of zeolite environmental material series. The issuance will assist Valiant to delve deeper into automobile exhaust treatment sector. Under the environment of more intense global atmosphere pollution, tighter legislation of automobile exhaust standards, Valiant as the strategic partner of global leader in automobile exhaust catalyst and through this private placement will possess adequate production and R&D capacity to welcome a new and flourishing market era.