On the evening of December 1, 2021, Ruyi Group disclosed its asset replacement plan. The company and its wholly-owned company Ruyi New Materials planned to use some accounts receivable and inventory as disposal assets, with a total original book value of 984 million yuan, and the company’s related party Wanzhong Part of the equity held by Chuangye in Lycra New Materials (Foshan) Co., Ltd. (hereinafter referred to as “Foshan Lycra”) was exchanged for assets. After the transaction is completed, Ruyi Group will quickly enter the high-end fiber new material industry, expand the company’s operating scope, and achieve transformation and upgrading.

In recent years, affected by the market environment and the end demand of the textile industry, Ruyi Group’s overall operating efficiency has been poor. The company urgently needs to find new profit growth points and improve its operating status. Foshan Lycra, the asset the company intends to invest this time, was established in August 2021. According to the plan, Foshan Lycra will receive an increase in capital from the original shareholders. After the capital increase is completed, Foshan Lycra will achieve an annual net profit of approximately 300 million yuan. The company’s main business includes new material technology promotion services, synthetic fiber manufacturing, bio-based material manufacturing, and synthetic material manufacturing. The inventory assets in the assets purchased this time are raw wool, tops, yarn and other goods that Ruyi Group reserves to avoid fluctuations in raw material prices. Ruyi Group stated that with the improvement of the company’s product quality and changes in market conditions, the inventory no longer meets the company’s actual production and operation needs. This replacement can solve the problem of capital constraints caused by the inventory.

Data show that Ruyi Group was formerly the Jining Woolen Textile Factory founded in 1972. It carried out joint-stock reform in 1993 and landed in the capital market in 2007, becoming a large-scale textile and clothing company integrating the design, production and sales of worsted fabrics and clothing. group. In July 2019, Ruyi Group launched a reorganization and planned to acquire the Jining Ruyi brand to indirectly control international high-end market clothing brands such as CERRUTI 1881 and transform and upgrade to high-end fashion brand operations. However, there has been no substantial progress in planning for more than two years. Until the end of September this year, Ruyi Group announced that the restructuring had failed.
Reading extension:

Shandong Ruyi established the “American Lycra Group” to take over the acquired apparel and high-end fabrics business of Invista

On January 31, 2019, Invista, an American polymer and fiber supplier, announced that it had sold its apparel and advanced fabrics business, one of the company’s four major business segments, to a subsidiary of China’s Shandong Ruyi Investment Holding Group.

INVISTA’s businesses involved in this transaction include:

• The fiber and brand product portfolio related to INVISTA’s apparel business includes: LYCRA® (Lycra®) fiber, LYCRA HYFIT® fiber, COOLMAX® fiber, THERMOLITE® fiber and thermal materials, ELASPAN® fiber, SUPPLEX® fiber and TACTEL® fiber products

• TERATHANE® PTMEG (polytetrahydrofuran), BDO (1,4-butanediol), THF (tetrahydrofuran) production

• Related production plants, R&D centers and sales offices worldwide

• All relevant technical, operational, commercial and functional department personnel (approximately 3,000 people worldwide)

INVISTA retains its nylon, polyester, polyol and technology licensing businesses and related brands, including its world-leading nylon 6,6 intermediates business, global nylon polymer and fiber portfolio, and widely recognized STAINMASTER® and ANTRON® brand carpets Fibers and CORDURA® brand fabrics. INVISTA will also retain the intellectual property rights of its BDO (1,4-butanediol), THF (tetrahydrofuran) and PTMEG (polytetrahydrofuran) technologies, and continue to license related technologies globally.

After the completion of this transaction, a new company, the American Lycra Group, will be established, with Ruyi as the controlling shareholder. The American Lycra Group will operate independently and maintain its unique positioning, corporate vision, development strategy and organizational structure. Ruyi and INVISTA’s original shareholder, American Koch Industries, will continue to work closely together to assist and ensure the smooth transition and handover of the post-transaction business.

Qiu Yafu, Chairman of the Board of Directors of Shandong Ruyi Investment Holding Group, said: “Invista International’s leading assets and technologies and brands recognized by consumers will produce significant synergies with Ruyi’s fabrics and apparel business. The successful completion of this acquisition provides us with Committed to comprehensive business integration, we strive to develop from a fabric and apparel manufacturer to a global leader in technological textile and fashion brands, further strengthening the group’s international business and brand portfolio, and setting a new milestone.”

</p