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AGY announces entry into a purchase agreement to sell its stake in AGY Shanghai

News International-French

5 Jun 2013

Last AGY Hong Kong Ltd, a majority-owned subsidiary of AGY entered into an agreement to sell its 100% equity interest in AGY Shanghai Technology Co., Ltd to Chongqing Polycomp International Corporation (CPIC) for aggregate consideration in the amount of $1 million.

The company is pleased to announce the agreement with CPIC to purchase their Shanghai business unit. “This divestiture allows us to focus on delivering value to our customers with products produced in the U.S., including our fine yarns and S-2 Glass products.  We believe that this is an important step towards successfully implementing our business strategy to be a world-class producer of advanced materials.” said Richard Jenkins, Interim CEO of AGY.

Drew Walker, President of AGY, added, “Despite the sale of the Shanghai division, AGY will continue to focus on the rapidly growing specialty electronics yarn markets. AGY offers a valuable and expanding product set to meet the growing demand for new high-value glass that stems from the growth of next-generation mobile communications devise.”

The transaction will result in a reduction in non-recourse debt totaling $38.8 million at March 31, 2013. The company’s AGY US and AGY Asia operating segments are managed separately based on differences in their manufacturing and technology capabilities, products and services, and their end-markets as well as their distinct financing agreements. During the first quarter of 2013, AGY Asia production output accounted for less than 0.7% of the sales recognized by the AGY US segment.