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Geely Automobile Holdings acquires two engine firms with RMB1.265 billion

Monika From Gasgoo| October 08 , 2018

Geely Auto Holdings buys two engine firms, Geely Auto engine annual capacity, China automotive news

Shanghai (Gasgoo)- Geely Automobile Holdings Limited (the Company) announced on October 5 that Zhejiang Geely Dongli Zongcheng Company Limited (Zhejiang Dongli), an indirect 99% owned subsidiary of the Company, agreed to acquire two engine firms with a total of RMB1.265 billion involved.

The announcement shows that Zhejiang Dongli entered into an acquisition agreement with Taizhou Geely Luoyou Engines Company Limited (Taizhou Engines), pursuant to which Zhejiang Dongli conditionally agreed to acquire, and Taizhou Engines conditionally agreed to sell, the entire registered capital of the Taizhou Binhai Geely Engine Company Limited (TZ Target), for a cash consideration of RMB781,274,109. 

On the same day, Zhejiang Dongli also entered into a similar acquisition agreement with Guiyang Geely Engines Company Limited (Guiyang Engines), pursuant to which Zhejiang Dongli conditionally agreed to acquire, and Guiyang Engines conditionally agreed to sell, the entire registered capital of Guizhou Geely Engine Company Limited (GZ Target), for a cash consideration of RMB484,003,363.

According to the announcement, Zhejiang Dongli is principally engaged in the research, development, production, marketing and sale of engines and related components in China. An annual capacity of 720,000 units of engines will reportedly be newly added for Geely Auto after the above two engine manufactories are completed.

As at the date of this announcement, Taizhou Engines is wholly owned by Zhejiang Geely Automobile Company Limited (Zhejiang Geely) while Guiyang Engines is owned as to 88.64% by Zhejiang Geely and as to 11.36% by an independent third party to the Company. Zhejiang Geely is owned as to 88.32% by Zhejiang Geely Holding Group Company Limited (Geely Holding).

It is reported that Taizhou Binhai Geely Engine Company Limited, registered in August, 2018, is constructing a manufactory with planned annual capacity of 360,000 units of engines, which is expected to be put into operation in the first quarter of 2019. Guizhou Geely Engine Company Limited is principally engaged in the production of three-cylinder turbocharged engine. Featuring a yearly capacity of 360,000 engines, its manufactory may be completed in the first quarter next year.

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