SMEIC Proposes to Acquire Shanghai Prime, a Good Catalyst for Building a Development Pattern Featuring Dual-wheel Driver
2024年5月14日 - 9:54PM
JCN Newswire
On the evening of 13 May 2024, Shanghai Mechanical &
Electrical Industry Co., Ltd. (?SMEIC? or the ?Company?, stock
code: 600835.SH) announced that in order to enhance the sustainable
development capability of the Company and to increase the return to
shareholders, SMEIC proposed to acquire the 100% equity interests
held by Shanghai Electric Group Company Limited (?Shanghai
Electric?), Shanghai Electric Hong Kong Co., Ltd. (?SEHK?) and
Shanghai Electric Group Hongkong Company Limited (?SEG HK?) jointly
in Shanghai Prime Mingyu Machinery Technology Co., Ltd.
(hereinafter referred to as ?Shanghai Prime?, the ?Target
Company?), the appraised value of the relevant equity interests was
RMB5,318 million, and the final transaction price will be subject
to the confirmation by the competent state-owned assets
administration department. Upon completion of the transaction,
Shanghai Prime will become a wholly-owned subsidiary of SMEIC.
It is understood that Shanghai Prime is a large-scale industrial
group specialising in the manufacturing of industrial basic parts
and key components and parts and related services, and is a
subsidiary of Shanghai Electric, a Chinese equipment manufacturing
group, which integrates multiple advantages such as R&D,
production and trade and is dedicated to provision of mechanical
components and parts and overall solutions for various industrial
markets and areas, boasting business segments such as bearings,
fasteners, blades and metal cutting tools. Shanghai Prime
subdivides its business segments into various sub-segments and
cultivates them strenuously, and its main subsidiaries/branches at
home have been recognised as ?professional, refined, featured and
innovative? enterprises at national, provincial and municipal
levels, while its blade and industrial fastener segments have been
awarded the title of ?Championship in Single?s in National
Manufacturing Industry? for consecutive times. Through years of
development, Shanghai Prime's business footprint has expanded to
over 10 countries, with its products being exported to more than 70
countries and regions around the world, and it has accumulated a
rich and high-quality customer base in energy, industrial
application and service, automotive, aerospace, rail transit,
railway and other industries.
With the accelerating reshaping of global industrial chain,
adhering to innovation-driven development and consolidating the
independent and controllable capability of the key and core
technologies of industrial chain has become increasingly important
for the security and stability of manufacturing industry.
Furthermore, the rapid development of the digital economy and the
promotion of the ?dual-carbon? goal have also brought forward new
requirement for the development of China's manufacturing industry.
Against such backdrop, the traditional manufacturing industry is
accelerating its transformation towards being independent,
high-end, intelligent and green, and new development opportunities
have been created. SMEIC?s acquisition of Shanghai Prime will
significantly enhance SMEIC?s overall business scale and core
competitiveness in industrial basic parts business, enabling it to
actively grasp the opportunities for transformation and development
in the manufacturing industry.
This transaction will boost the strategic upgrade of SMEIC, clarify
the positioning of the Company as a ?professional, refined,
featured and innovative? industrial platform, further broaden its
industrial basic parts, key components and parts, sub-system and
mechatronics products, build a diversified product portfolio, and
give full play to the attribute of SMEIC as a listed company
capital platform as well as the advantageous position of Shanghai
Prime in the field of industrial basic parts and key components and
parts, to help the Company to rapidly realise the product extension
for its ?professional, refined, featured and innovative? businesses
along the current industrial chain, reinforce the industrial basic
parts business portfolio, push the ?professional, refined, featured
and innovative? industrial segment of the Company's industrial
basic parts business to develop towards being high-end, serialised
and integrated, and accelerate the upgrade of the domestic
industrial basic parts industry, serving the manufacturing power
strategy of our country.
Besides, this transaction will help SMEIC to gradually expand its
business scope from lift industry with stable development to basic
parts aerospace, new energy automobile, robotics, medical equipment
and other industries with more promising growth prospects. After
the resource integration, SMEIC will strive to achieve the ?three
new? development, namely new technology, new products and new
markets, through continuous technological innovation, the extension
of upstream ?professional, refined, featured and innovative?
business line, and the development of domestic strategic
application and overseas ?new? markets of the Belt and Road
Initiatives, helping SMEIC to build the ?second growth curve? based
on the ?professional, refined, featured and innovative? with the
synergy through the diversification of the products and markets
while maintaining the healthy and steady development of the primary
industry, forming a new development pattern featuring dual-wheel
driver.
Furthermore, this transaction will also be conducive to the
adjustment and optimisation of the Company's industrial structure.
After the completion of this transaction, SMEIC will become one of
the world's largest comprehensive industrial basic parts
conglomerates by virtue of a relatively wide range of products
offerings and a relatively large scale of operation, continuously
improving its assets quality and profitability, creating further
room for its future development as a listed company, further
enhancing its value in the capital market and creating more returns
to shareholders.
According to the data, Shanghai Prime has sound main business and
operating condition. In 2022 and 2023, the revenue of Shanghai
Prime amounted to RMB8,980 million and RMB9,585 million,
respectively, and its net profit attributable to parent company
amounted to RMB349 million and RMB237 million, respectively. As at
31 December 2023, the total assets of Shanghai Prime amounted to
RMB11,263 million.
If Shanghai Prime is merged into SMEIC, the earnings per share of
SMEIC for 2022 and 2023 will represent an increase of 35.42% and
23.47% respectively over that before the merger. In terms of
revenue sources, in 2022 and 2023, the proportion of revenue of
SMEIC from its ?professional, refined, featured and innovative?
related businesses will significantly increase from 1.94% and 2.61%
before the merger to 29.00% and 31.87% after the merger, resulting
in obvious optimisation of its business structure.
SMEIC said that in the future, the Company will fully leverage the
integration and synergy effect with Shanghai Prime, to achieve
seamless business connection and consolidate its leading position
in the industry. In terms of market development collaboration, it
will focus on the common downstream market for the two sides,
through joint development, improve the overall performance of
products, while expand common customers and services, forming a
package of comprehensive solutions, to enhance customer stickiness
and improve the value of services. In terms of scientific and
technological innovation collaboration, it will strengthen the
research on common technologies and processes of the two sides, to
deepen the scientific and technological research and development
reserves, and enhance the digital and intelligent synergy. In terms
of resource allocation, it will actively promote the sharing of
high-quality resources between the two sides, and leverage the
listing platform to select upstream and downstream strategic
investment opportunities for capital operation, etc., to
continuously enhance the global competitiveness of the Company's
industrial basic parts business.
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