Wuxi Zhenhua(605319) Announcement on the evening of July 18th, the company plans to issue shares and pay cash to purchase 100% equity of Wuxi Kaixiang held by the actual controllers Qian Jinxiang and Qian Ben; following the completion of this transaction, Wuxi Kaixiang will become a listed company A wholly-owned subsidiary of the company. At the same time, the company plans to issue shares to no more than 35 (inclusive) specific investors to raise supporting funds. The evaluation work involved in this transaction has not been completed, and the specific estimated value and transaction price have not yet been determined.
As the target of this acquisition, Wuxi Kaixiang is mainly engaged in the R&D and manufacturing of selective precision electroplating products, providing downstream customers with solutions for selective precision electroplating of mechanical parts and electronic components. Selective precision chrome-plating treatment of high-pressure fuel pump related parts, the above-mentioned parts are used in the high-pressure electronic injection system of gasoline engine, and belong to the engine spare parts industry.
according toWuxi ZhenhuaAccording to the announcement, Wuxi Kaixiang is a strategic supplier in the surface treatment field of United Electronics (the business related to the domestic gasoline vehicle EFI system of Bosch in Germany is carried out by its joint venture, United Electronics). At present, Wuxi Kaixiang provides precision chrome plating services for parts related to high-pressure fuel injectors and high-pressure fuel pumps of automobile engines to United Electronics and its designated first-tier suppliers, and charges surface treatment processing fees per piece. United Electronics has an absolute leading position in the field of high-voltage electronic injection systems for gasoline engines, with a market share of more than 50%.
Wuxi Kaixiang has comprehensive metal surface treatment technology, mastered advanced selective precision electroplating technology, and has strong competitiveness in the field of high-end metal surface treatment. In recent years, there have been sufficient orders and good business performance.
Wuxi Kaixiang achieved net profits of 47.8392 million yuan, 78.4787 million yuan and 17.3262 million yuan in 2020, 2021 and January to March 2022 respectively.
Wuxi ZhenhuaThe main business is the development, production and sales of automobile stamping and welding parts and related molds, as well as the provision of sub-assembly processing services. It has obvious market competitive advantages in the domestic passenger vehicle supporting field, and has strong research and development, production. Manufacturing capability and overall supporting program design capability. The company’s current main customers include SAIC Volkswagen, SAIC-GM, Li Auto, Tesla and other well-known vehicle manufacturers as well as United Electronics,Yapu sharesand Edsha and other well-known auto parts suppliers.
Wuxi ZhenhuaThe total assets at the end of 2021 were 3.111 billion yuan, and the operating income and non-net profit in 2021 were 1.582 billion yuan and 91 million yuan respectively.
After this transaction is completed,Wuxi ZhenhuaThe core business layout of engine spare parts will be added, and the selective precision electroplating business will be further expanded.Wuxi ZhenhuaThe scale of assets and profits will be expected to further expand.
When talking regarding the impact of this acquisition,Wuxi ZhenhuaSaid that following the acquisition, the listed company will accelerate the integration of auto body stamping and welding parts and auto engine parts related businesses, further optimize the listed company’s business system, expand and strengthen the auto parts business, and become a more competitive, A leading auto parts industry group in the industry.
In addition, in view of the increasing trend of operating income and net profit of Wuxi Kaixiang in the past two years, it has strong profitability and stable cash flow. After the completion of this transaction, it will help the listed company to improve its profitability, increase the profit scale, and relieve the short-term operating pressure and capital pressure of the listed company due to rising raw material prices.
