Daqo New Energy announced that it proposes to restructure Xinjiang Daqo New Energy Co., Ltd. (Xinjiang Daqo), a subsidiary of the Company, and is exploring the idea of listing Xinjiang Daqo separately on the National Equities Exchange and Quotations, an emerging over-the-counter market in China (the "New Third Board"). Xinjiang Daqo operates the polysilicon production facilities of the Company located in Shihezi, Xinjiang Uyghur Autonomous Region.
Pursuant to the restructuring plan, which has been approved by the board of directors of the Company and its audit committee, Xinjiang Daqo Investment Co., Ltd., a wholly-owned subsidiary of Daqo Group, will subscribe for newly issued equity interest of Xinjiang Daqo representing 1% of the total outstanding equity interest of Xinjiang Daqo. After the restructuring, Daqo will hold 99% of the outstanding equity interest of Xinjiang Daqo. The restructuring is aimed at meeting the PRC legal requirement that a company to be listed on the New Third Board shall be in the form of a limited company by shares with at least two shareholders.
Daqp expects that, after the proposed New Third Board listing of Xinjiang Daqo, the Company's American depositary shares ("ADSs", each representing 25 ordinary shares) will continue to be traded on the New York Stock Exchange, and its ordinary shares will continue to be registered under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Company does not have any current plan or intention to pursue any "going-private" transaction or any other transactions having the purpose or effect of causing its ADSs to no longer be traded on the New York Stock Exchange or its ordinary shares to no longer be registered under the Exchange Act."Daqo New Energy has established a leadership position in our industry as a low-cost and high-purity polysilicon manufacturer," said Dr. Gongda Yao, Chief Executive Officer of the Company. "The potential listing of Xinjiang Daqo on the New Third Board will offer us new opportunities to accelerate our growth and enhance our core business."
The New Third Board is a national over-the-counter stock exchange that supplements trading activities on the Shanghai and Shenzhen stock exchanges, including the related Growth Equity Market (GEM) exchanges. The New Third Board offers a new channel for enterprises in China to access the capital markets and to gain greater exposure to the investment community.