Zoomlion Subsidiary to Undergo Reorganization and Listing
Huasheng Online, July 11th – Zoomlion, a leading manufacturer of construction machinery and equipment, has announced its plan for the reorganization and listing of its subsidiary, Hunan Zoomlion Intelligent Aerial Work Machinery Co., Ltd. The plan aims to spin off the subsidiary and list it as a separate entity. According to the plan, Zoomlion High-Tech will become a wholly-owned subsidiary of Shenzhen Luchang Technology Co., Ltd., with Zoomlion retaining its position as the controlling shareholder of Luchang Technology.
The pre-plan outlines that Luchang Technology will acquire 100% of the shares held by Zoomlion High-Tech from 29 shareholders at an issue price of 23.89 yuan per share. The total transaction price amounts to 9.424 billion yuan. Additionally, Luchang Technology intends to raise matching funds of up to 3.35 billion yuan from specific sources. Out of this, 1 billion yuan will be allocated for the construction project of a Mexican production base, while 2.35 billion yuan will be used to supplement the working capital or repay the debts of Luchang Technology and Zoomlion High-Tech.
The decision to spin off Zoomlion High-Tech and focus on the development of the aerial work platform sector aligns with Zoomlion’s strategic objective of furthering the growth of its mechanical equipment business. By clarifying the main business structure, both Zoomlion and Zoomlion High-Tech can concentrate on their respective areas of expertise, fostering balanced growth across the Zoomlion system.
Zoomlion High-Tech specializes in the research and development, production, sales, and service of aerial work machinery. It has gained a competitive edge in terms of technology and product offerings, leading to significant growth in recent years. Its operating income is projected to reach 1.028 billion yuan in 2020, 2.978 billion yuan in 2021, 4.583 billion yuan in 2022, and 1.837 billion yuan in the first four months of 2023. By 2022, it is expected to become the seventh largest high-altitude platform maker globally.
Industry experts believe that the spin-off and listing of Zoomlion High-Tech will considerably enhance the capital strength of the aerial work platform sector. This move will facilitate talent acquisition, product research and development, as well as expansion into overseas markets. As a result, significant progress is anticipated in the business layout, further improving the overall profitability of Zoomlion.
Industry analysts view this reorganization and listing as a strategic step for Zoomlion to solidify its position as a leader in the construction machinery industry. With the growing demand for advanced aerial work platforms, Zoomlion aims to capitalize on the opportunities in this market segment.
– All media reporter: Huang Lifei
(Note: This article went through three trials. First trial: Xie Zhenhua Second trial: Jiang Yu Third trial: Jiang Yuqing)