Anhui Conch Cement Co has agreed to more than double its stake in West China Cement Ltd for HK$4.59bn (US$592m).

Conch International Holdings (HK), a wholly owned unit of Anhui Conch, plans to increase its holding in Shaanxi-based West China from 21.17 per cent to to 51.57 per cent, the companies said in a filing to the Hong Kong exchange Friday. If the transaction goes through, Anhui Conch will have to make a mandatory cash offer for all shares of West China it doesn’t own, the filing showed.

West China has agreed to buy four units of Anhui Conch: Baoji Zhongxi Fenghuangshan Cement, Baoji Zhongxi Jilinhe Cement Co, Qianxian Conch Cement and Qianyang Conch Cement from Anhui Conch Cement  for a total of HK$4594m. The acquisition targets are principally engaged in the manufacture and sale of cement in Shaanxi Province of PRC. West China will issue shares in itself to pay for the purchase, the companies said in the filing. West China will issue 3.403bn shares at HK$1.35 each – a 6.9 per cent discount to its last traded price of HK$1.45 – for a total of HK$4.59bn. The issuance will raise Anhui Conch’s stake in West China.

Should Anhui Conch be required to make an offer for the rest of West China, it will pay HK$1.69 in cash for each share, according to the filing. That’s the same as the subscription price of shares West China last sold to Anhui Conch in June.