HARBIN, China, March 12, 2013 /PRNewswire/ -- China XD Plastics Company Limited (NASDAQ: CXDC, "China XD Plastics" or the "Company"), one of China's leading specialty chemical players engaged in the development, manufacture and sale of modified plastics primarily for automotive applications, today announced the official signing of an agreement with the People's Government of Shunqing District, Nanchong City of Sichuan Province to construct its fourth production base with 300,000 metric tons plastics new material production capacity and the affiliated research and development center and training center ("the Project").
According to the its development plan, the Company plans to commence the construction of its fourth production base with 300,000 metric tons production capacity in 2013 following its launches of 45,000, 120,000 and 225,000 metric tons production bases in tandem. The Company plans to complete the Project in approximately two years, funded with its existing cash and cash equivalents, its future operating cash flows and certain debt financing. The decision to build the fourth production base follows China's 12 th Five-Year Plan, which promotes green and environmental protection sectors and new material industries. The Company will benefit from favorable tax policies under China's Western Development Program by locating the Project in Southwest China.
The Project will be constructed in Nanchong City of Sichuan Province, the center of Chengdu-Chongqing Economic Zone. Within a 400 kilometer radius of the construction site, there are factories for automotive manufacturers such as Shanghai GM, Volvo, Changan Ford and Dongfeng, etc. and a good number of automotive parts manufacturers. The region is also home to industries of high-end applications that the Company has been pursuing, including China Southern Rail Corporation ("CSR") and China Northern Rail Corporation ("CNR) in the high-speed railway sector, and Xi'an Aircraft Industry (Group) Company Limited, Chengdu Aircraft Industrial (Group) Company Limited and Guizhou Aviation Industry (Group) Company Limited, etc.