Xinyi takes over glass competitor
Xinyi Glass Holdings, the country's largest vehicle glass and windshield exporter, has bought a laminated glass maker for HK$236.98 million to strengthen its global market position.
Chief executive Gerry Tung said the acquisition of Shenzhen China Southern Automobile Glass as a new subsidiary was also expected to contribute some US$300 million to Xinyi's turnover by the end of next year.
'The acquisition will help consolidate our role as a leading vehicle glass manufacturer and exporter in both the domestic and overseas markets and allow our business to grow more rapidly,' said Mr Tung said.
'The deal will help boost our production capacity while generating a greater turnover for our company.'
Xinyi Glass holds 35 per cent of the country's aftermarket for car glass and about 10 per cent of the global aftermarket.
Shenzhen CS Automobile Glass, a unit of China Southern Glass, is one of the country's top three laminated car glass exporters. It has an annual production capacity of 1.3 million units of car glass products and holds 3 per cent of the domestic market.
Xinyi Glass has an annual production capacity of 8.3 million pieces. Last year, its total turnover was HK$1.9 billion.
'Our total turnover and earnings will continue to rise in the next few years, thanks to the company's healthy growth and the whole car market,' said Wesley Lee, Xingyi Glass's executive director.
He ruled out the possibility of an appreciating yuan squeezing the firm's export business. 'Despite the yuan's appreciation ... we do not see this as something that would hinder our growth,' he said.
Morgan Stanley said Xinyi Glass's turnover should rise to HK$2.86 billion and net earnings to HK$664 million this year.