Avic International unit to buy China’s largest electronic flat product display supplier
Avic International Holdings, an electronics manufacturing unit of state-owned aerospace giant Aviation Industry Corp of China, says its mainland-listed unit has agreed to buy Xiamen Tianma Microelectronics, the country’s largest flat product display supplier, for 10.6 billion yuan (US$1.5 billion).
Xiamen Tianma, also the world’s fourth-largest supplier with a 12 per cent share in 2015, supplied displays used in electronic products such as smartphones and related materials as well as the equipment that produced them, Avic International said in a filing to the Hong Kong stock exchange on Sunday.
Under the deal, Avic International’s Shenzhen-listed unit Tian Ma Microelectronics will buy all of Xiamen Tianma.
“With the increasing production capacity and the impending end of the developing period, the revenue and net profit of Xiamen Tianma in recent years presented rapid growth year on year,” Avic International said.
“In the future, Xiamen Tianma will make further arrangements for emerging technological display
products such as [virtual reality] and professional display products such as vehicle displays.”
Xiamen Tianma posted net profit of 353.5 million yuan in the first nine months of last year, compared with profits of 301.5 million yuan for the whole of 2015 and 28.9 million yuan for the whole of 2014.
It is currently 64 per cent-owned by start-up company investor Xiamen Jincai Industrial and 30 per cent by aviation equipment-to-property conglomerate Avic International Holding Corp, the parent company of Avic International Holdings. The rest is owned by commodities trader Catic Xiamen, a subsidiary of Avic International Holdings.
The transaction will be subject to approval by the independent shareholders of Avic International Holdings.
Tian Ma Microelectronics plans to pay for the acquisition by issuing shares.
It has separately proposed to raise 1.9 billion yuan by selling 112 million new A shares at 17.23 yuan each to up to 10 investors to fund construction of production lines by Xiamen Tianma.