Shanghai Petrochemical Co., Ltd. (00338) plans to merge with Baling New Materials

Zhitong Finance App News, Shanghai Petrochemical Co., Ltd. (00338) issued an announcement. On January 8, 2026, the board of directors reviewed and approved the bill on the company's merger with Baling New Materials, and agreed to amend the Baling New Materials Charter and the terms of the joint venture contract. Prior to this revision, Baling New Materials and Hunan Petrochemical each held 50% of the shares, and their financial statements were included in the scope of Hunan Petrochemical's consolidated statements. After the completion of this revision, although the shareholding structure of Baling New Materials has not changed, the Company's voting rights and corporate governance authority in Baling New Materials will be further enhanced, and Baling New Materials will be included in the scope of the Group's consolidated statements and become a subsidiary of the Company. The company will sign a new joint venture contract with Hunan Petrochemical no later than March 31, 2026 after the extraordinary shareholders' meeting reviews and approves this merger.

Although the shareholding structure of Baling New Materials has not changed, by amending the Baling New Materials Charter, the Company's voting rights and corporate governance authority in Baling New Materials have been further enhanced. Baling New Materials will be included in the scope of the Group's consolidated statements and become a subsidiary of the Company.

As a developer and manufacturer of high-end new materials such as thermoplastic elastomers with technical and product advantages, Baling New Materials will make up for a key part of the company's strategic layout in the field of high-end new materials, improve the high-end thermoplastic elastomer industry chain, seize the key market for future material upgrades, and optimize the company's product structure. After this merger, Baling New Materials and our company will exert a synergetic effect to strengthen our competitive advantage. The company can also directly introduce Hunan Petrochemical's mature and advanced full set of thermoplastic elastomer technology through Baling New Materials to quickly form high-end production capacity. Baling New Materials has been listed as a major industrial project in Shanghai.