On June 1, Tianjin-based Chinese steel pipe producer Tianjin Youfa Steel Pipe Group Co., Ltd. inked a strategic cooperation agreement with Hebei Province-based Chinese steel pipe company Longtaidi Pipe Technology. Accordingly, Tianjin Youfa Steel Pipe will acquire 53 percent equity in Longtaidi Pipe at a cost of RMB 672 million ($98.5 million). After the transaction, Longtaidi will become a controlled subsidiary of Youfa Group.
As a strategic partnership between a listed company that is a domestic leader in welded steel pipes and a benchmark enterprise in the bimetallic composite pipe niche, this cooperation will fill the void in Youfa's presence in the corrosion-resistant, high-end composite steel pipe segment. Leveraging Longtaidi's mature technologies and domestic and overseas market resources, the partnership will enable rapid entry into high-end pipe markets spanning oil and gas, petrochemicals, power, and pipeline networks, which will unlock incremental growth in high-margin products.
According to the agreement, the original shareholders of Longtaidi gave a commitment that the net profit for the year 2026 shall be no less than RMB 120 million ($17.6 million) and that a cumulative net profit of no less than RMB 450 million ($66 million) will be achieved over the next three years, which will bring tangible growth to Youfa Group's operating performance and make a significant contribution to the listed company's high-quality and sustainable development.