Lifan Technology and Geely Automobile set up a joint venture company to comprehensively upgrade the car manufacturing business

Following the reorganization, the cooperation between Lifan and Geely continued to deepen. On the evening of December 13, Lifan Technology announced that the company intends to jointly invest with Geely Automobile Holdings Co., Ltd. to establish a joint venture company in the directly administered district of Liangjiang New District, Chongqing, with a registered capital of 600 million yuan, and both parties will invest 300 million yuan in monetary funds, each holding 50% of the shares. The business scope of the joint venture includes vehicle design, research and development, sales (including accessories, parts processing equipment, automotive decoration) and so on.

According to the information, Geely Automobile is an offshore company registered in the Cayman Islands, established on June 5, 1996, with a registered capital of 240 million Hong Kong dollars, the actual controller Li Shufu, the scope of business is the research and development, production and sales of passenger cars and core components. As of December 31, 2020, Geely Automobile had total assets of 110.816 billion yuan and net assets of 64.213 billion yuan, and achieved operating income of 92.114 billion yuan and net profit of 6.441 billion yuan in 2020. Chongqing Jianghehui Enterprise Management Co., Ltd. (20% share ratio), the second largest shareholder of Lifan Technology, and Geely Automobile are the same actual controllers, and Yang Jian, a director of the company, is an executive director of Geely Automobile, and the above transaction constitutes a related party transaction.

According to the "Investment Cooperation Agreement" signed by the two parties, Geely Automobile will fully support the management and operation of the joint venture's car-making business, and jointly promote the transformation and upgrading of Lifan Technology's automobile industry with Lifan Technology, relying on Geely Automobile's systematic advantages and professional capabilities in the whole process of car-making, through fine management and industrial empowerment, integrate, improve and upgrade Lifan Technology's automobile R&D system, supply chain management, technology platform, sales channels and systematic manufacturing management programs to achieve win-win development.

Synchronously build a quality ecology of the whole value chain, ensure the quality of the whole ring such as R&D, manufacturing, supply chain, and after-sales service, implement the concept of "zero defects", focus on user needs, respond quickly, promote the construction of after-sales AAA service demonstration stations, improve service standards, and create user loyalty service quality. At the same time, it will join forces with Lifan Technology and integrate development to explore a new path for the transformation and upgrading of Lifan Technology's new energy manufacturing industry and high-quality development.

In addition, the two sides will also coordinate travel companies and power exchange service companies to match models, work together to build a power exchange network ecology, and promote the development of urban power exchange standardization. The target company will continue to develop and upgrade its vehicles to meet market demand and create more value for listed companies.

Lifan Technology said that this investment is conducive to promoting the transformation and upgrading of the company's automobile industry, focusing on the research and development, sales and operation of complete vehicles (including but not limited to power-changing models), promoting the rapid increase of product market share in passenger cars, and promoting the sustainable, healthy and stable development of the company's future business. (Wang Yi)