OREANDA-NEWS. Gulf Resources, Inc., a leading manufacturer of bromine, crude salt and specialty chemical products in China, today announced the merger of its two chemical divisions, Yuxin Chemical and Rongyuan Chemical. Under the terms of the agreement, Yuxin will acquire Rongyuan. After the merger is completed, during the third quarter of 2016, Yuxin will be the surviving division.

The senior management of the two divisions will be merged as well the finance, personnel, production, procurement, sales, logistic and R&D departments. Gulf believes it should be able to eliminate the substantial cost duplication between the two divisions. In addition, the management of Gulf Resources believes that the merger of the two divisions will give it greater bargaining power in both procurement and sales.  All of the existing factories will continue in operation.

Mr. Xiaobin Liu, the CEO of Gulf Resources stated, “In the current economy of China, we have to consider every opportunity to reduce costs and improve profitability. We have two divisions that all produce chemical types of products in similar locations. By merging these two businesses, we can eliminate the duplication in management, finance, sales, procurement, logistics, R&D, and other departments. While it is too soon to quantify the full amount of the savings, we do believe it could benefit company in many ways.”

“In addition,” Mr. Liu continued, “We believe that one business doing nearly $100 million in revenues  after merger will have greater leverage in procuring products and machinery and in selling to end customers. In addition, the merger of these two divisions will make our company easier for investors to understand and evaluate.”

“We continue to focus on ways of improving the profitability of Gulf Resources,” Mr. Liu concluded. “While we are pleased with the company operation and are very optimistic about our natural gas project, we want investors to understand that we are also focused on reducing costs and improving profitability wherever we can.“

Gulf Resources, Inc. operates through four wholly-owned subsidiaries, Shouguang City Haoyuan Chemical Company Limited ("SCHC"), Shouguang Yuxin Chemical Industry Co., Limited ("SYCI"), Shouguang City Rongyuan Chemical Co, Limited (“SCRC”) and Daying County Haoyuan Chemical Company Limited (“DCHC”). The company believes that it is one of the largest producers of bromine in China. Elemental Bromine is used to manufacture a wide variety of compounds utilized in industry and agriculture. Through SYCI, the company manufactures chemical products utilized in a variety of applications, including oil and gas field explorations and papermaking chemical agents. SCRC is a leading manufacturer of materials for human and animal antibiotics in China and other parts of Asia. DCHC was established to further explore and develop natural gas and brine resources (including bromine and crude salt) in China. For more information, visit www.gulfresourcesinc.com.