On March 3, 2024, Migao Group Holdings Limited (“MGM Group”) from Gaoming District, Foshan, Guangdong, disclosed the prospectus after the hearing on the Hong Kong Stock Exchange, or was listed on the Hong Kong Main Board soon. It was submitted three times on July 6, 2022, February 28, 2023, and September 22, 2023.
The MGM Group was listed on the Toronto Stock Exchange GEM in 2006, transferred to the Toronto Stock Exchange in 2007, then privatized and delisted in 2016.
Link to the prospectus of MGM Group after the hearing:
https://www1.hkexnews.hk/app/sehk/2023/105746/documents/sehk24030300025_c.pdf
Main business
As a leading potash company in China, Migao Group has comprehensive capabilities integrating procurement, manufacturing, processing and sales. It mainly provides various types of potash fertilizer products, including potassium chloride, potassium sulfate, potassium nitrate, compound fertilizer, etc.
According to Frost & Sullivan's report, based on 2022 potash sales, Migao Group ranked third among Chinese potash fertilizer companies (market share of about 7.1%) and second among Chinese non-reserve potash companies; based on 2022 sales of potassium chloride, potassium sulfate and potassium nitrate, it ranked third, fourth, and fifth among Chinese potash companies, respectively, with market shares of 7.0%, 4.0%, and 0.3%, respectively.
Migao Group was awarded the “China Potash and Potash Industry Meritorious Enterprise” by the Potash and Potash Fertilizer Branch of the China Inorganic Salt Industry Association in 2020, and has been continuously (since 2016) selected by the China Chemical Information Center and the China Chemical Intelligence and Information Association as the “China Top 10 Potash Fertilizer Companies” and “China's Top 100 Chemical Fertilizer Companies”.
Migao Group has five main production facilities in Heilongjiang Province, Jilin Province, Guizhou Province and Guangdong Province. It has three potassium chloride granulation lines, 40 potassium sulfate production lines and three compound fertilizer production lines. The total estimated production capacity of potassium chloride granules, potassium sulfate and compound fertilizer is 390,000 tons, 363,000 tons, and 172,000 tons, respectively. In addition, the company's production facilities in Chengdu, Sichuan will be relocated and is planning to build a new Sichuan production facility in Mianyang City, Sichuan Province, which is expected to be completed and put into operation in the second half of 2025.
Shareholder structure
According to the prospectus, in the pre-listing shareholder structure of MGM Group, the controlling shareholder was Mr. Liu Guocai, who held 100% of the shares.
Directors and Executives
The board of directors of MGM Group consists of 6 directors, including 3 executive directors (Mr. Liu Guocai, Mr. Sun Pingfu, and Mr. Dong Benzi) and 3 independent non-executive directors (Mr. Chen Guofu, Ms. Huang Shasha, and Ms. Gao Qing).
In addition to the executive director, executives include Ms. Liu Yaqin, Director of Finance; Mr. Fu Yangmei, Sales Manager; Mr. Liu Xuebin, Head of Production (North China); and Mr. Shi Kaiguo, Head of Production (South China).
Company performance
According to the prospectus, in the past fiscal year 2021, fiscal year 2022, fiscal year 2023, and the eight months ending November 30, 2023 (the fiscal year ends on March 31), the operating income of the MGM Group was RMB 2,082 billion, $3.841 billion, $4.723 billion and RMB 2,284 billion, respectively. The corresponding net profit was RMB 207 million, 397 million yuan, 422 million yuan and 162 million yuan, respectively.
Intermediary team
The intermediary team for the current IPO of MGM Group mainly includes: Guangfa Finance (Hong Kong) as its sole sponsor; Deloitte as its auditor; Jingtian Gongcheng and Aster are the company's Chinese lawyers and Hong Kong lawyers respectively; Commerce and Morgan Lewis are the company's Chinese lawyers and the company's Hong Kong lawyers respectively; and Frost Sullivan is its independent industry advisor.