A-share fruit chain leader Lixun Precision has joined hands with Chery to do big things.
On the evening of February 11, Lixun Precision announced that the company signed the "Strategic Cooperation Framework Agreement" with Chery Group, and intends to jointly establish a joint venture with Chery New Energy to specialize in the research and development and manufacturing of new energy vehicles.
Comprehensively hand in hand with Chery Group to force automobile OEM
According to the announcement, On February 11, Lixun Precision signed the Strategic Cooperation Framework Agreement with Chery Holding Group Co., Ltd. ("Chery Holding"), Chery Automobile Co., Ltd. ("Chery"), chery New Energy Automobile Co., Ltd. ("Chery New Energy" )) (the three and its affiliates collectively referred to as "Chery Group") in Wuhu.
The agreement stipulates that Luxun Precision and Chery New Energy intend to jointly form a joint venture company, specializing in the research and development and manufacturing of new energy vehicles, providing cutting-edge R&D design, mass production platform and sea exit for Lixun Precision's core auto parts business, and is committed to achieving the company's medium- and long-term goal of becoming a leading manufacturer of tire1 auto parts.
Pursuant to the Agreement, the Parties shall use their respective best efforts to facilitate the establishment of the Cooperating Subsidiary within 3 months of the signing of this Agreement. The cooperative subsidiary intends to adopt an equity structure in which Lixun Precision (Party A) subscribes 500 million yuan to hold 30% of the registered capital, chery New Energy subscribes 1.167 billion yuan and holds 70% of the registered capital, and the subscription price for each 1 yuan of registered capital is 1 yuan. After the establishment of the cooperative subsidiary, under the premise of meeting the legal compliance, the cooperative business will be carried out and the results will be achieved as soon as possible.
Luxun Precision said that the signing of this strategic cooperation agreement does not constitute a major asset restructuring as stipulated in the Measures for the Administration of Material Asset Restructuring of Listed Companies, does not constitute a related party transaction, and does not need to be submitted to the company's board of directors and shareholders' general meeting for consideration.
Lixun Precision also announced that on the day of the signing of the agreement, the company's controlling shareholder, Lixun Co., Ltd. (hereinafter referred to as "Lixun Limited") and Qingdao Wudaokou New Energy Automobile Industry Fund Enterprise (Limited Partnership) (hereinafter referred to as "Qingdao Wudaokou") signed the "Equity Transfer Framework Agreement", stipulating that Lixun Limited would purchase 19.88% of the equity of Chery Holdings, 7.87% of the equity of Chery Shares and 6.24% of the equity of Chery New Energy held by Qingdao Wudaokou for 10.054 billion yuan. After the completion of the transaction, Luxun Limited does not control Chery Holdings, Chery Shares and Chery New Energy. Before the signing of the Equity Transfer Framework Agreement, Qingdao Wudaokou held 46.77% of the equity of Chery Holdings, making it the largest shareholder of Chery Holdings.
For Luxshare Precision and Chery to join forces, the stock bar is bullish and bearish. Some shareholders asked: Is Luxshare preparing for oem Apple cars?
▲Source: Shares
A powerful combination
Accelerate the layout of the automotive business
Luxun Precision started from the connector products, is one of the important components of smart phones, the later continuous expansion of production capacity and product lines, 10 years ago through the acquisition of successfully entered the Apple supply chain, is currently for Apple to assemble AirPods, iPhone and other star products, which also means that its foundry level is at the forefront of the industry.
As the smartphone market falls into the Red Sea, Luxshare Precision has expanded its automotive electronics business in addition to the original consumer electronics and communication products, and its strong electronic manufacturing capabilities are also very much needed in the intelligent process of new energy vehicles. Luxshare Precision mainly produces products and solutions for automotive wiring harnesses, electrical appliances, connectors and structural parts. This cooperation can also be seen in the transformation of Luxshare Precision from horizontal expansion to in-depth expansion.
▲Lixun Precision Chairman Wang Laichun
In August 2021, Luxshare Precision said in an institutional survey that in the automotive wiring harness business, the company is in a leading position in the industry, and its customers include both new domestic car-making forces and North American new energy brand customers, and this part of the product is also an important product line of the company's automotive business in the next five years. In the automotive interior segment, the company also has a relatively good product module, such as wireless charging modules, the company has been among the forefront of the industry in this business area. In addition, in the field of automotive cameras, the company fully collaborates with in vitro companies, which also helps the company to achieve extension in different markets and customers. The management has also said in the survey many times that the company's experience in consumer electronics and communication business has given it a certain advantage in the application scenarios of automotive electronics, "I believe that automotive electronics will be a main battlefield for Luxshare in the future." ”
According to The 2021 mid-year report of Luxshare Precision, consumer electronics products are still the company's main source of revenue, accounting for nearly 84% of total revenue, and automotive-related products account for about 4% of total revenue, at 1.77 billion yuan.
Although revenue is relatively small, its automotive business is growing rapidly. In 2020, the revenue of Luxshare Precision Automotive-related products increased by 20.44%, and since 2022, Luxshare Precision has also accelerated its investment in the automotive field. On January 3, Luxshare Precision (Macheng) Automotive Electronics Industrial Park project was successfully signed. This is Luxshare Precision's first engineering project in the central region.
▲On January 3, 2022, Luxshare Precision Automotive Electronics Industrial Park signed a contract with Macheng
In addition, before the signing of the agreement, Luxshare Precision established an auto parts company in Wuhu, Anhui Province, which is the location of Chery's headquarters.
According to the national enterprise credit information publicity system, on January 28, 2022, Luxun Precision Industry (Wuhu) Co., Ltd. was established with a registered capital of 20 million yuan. The business scope includes automobile parts and accessories manufacturing; auto parts wholesale; electronic product sales; transportation equipment and production of counting instrument manufacturing; instrumentation manufacturing; electronic components retail; new energy vehicle electrical accessories sales; mold manufacturing; mold sales; etc.
It is understood that as one of the head camp car companies of Chinese auto brands, Chery Group's global users have exceeded 10 million. According to the monthly ranking of the China Association of Automobile Manufacturers in 2021, Chery Speed ranked first in the sales growth rate of the whole industry for many consecutive months, and achieved a high-quality development pattern in which the two major domestic and overseas markets promote each other.
Chery Holdings and its affiliated subsidiaries have been working in the automotive industry for many years, have a complete technology and product research and development system in the field of vehicles, especially in the process of vehicle manufacturing, have an independent platform, and can provide Chery Automobile and other brand owners with comprehensive services from vehicle development to mass production, and have a core competitive advantage in the industry.
▲Chery Automobile
Lixun Precision said that the company and Chery Holdings and its affiliates jointly signed a strategic cooperation framework agreement, aiming to strengthen the company's automotive business strategic layout in an all-round way, make full use of Chery Group's deep technology precipitation and terminal brand resources in the field of new energy vehicles, set up a joint venture company and the company's accumulated technology in the field of consumer electronics over the years and customer resources for cross-border empowerment, in the vehicle joint venture platform as a frontier R & D and design, mass production platform and the support of the sea outlet, dynamic entry, Quickly improve the company's comprehensive capabilities as the core components of Tier1 manufacturers, quickly polish, optimize and increase in practice, realize the diversification and large-scale development of the company's core components, and achieve the medium- and long-term goal of becoming a leading tier1 manufacturer.
Source: China Securities News, e Company, Interface, Baijia No. - Che Yi Circle
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