Exquisite Technology Creates Luxury Driving Experience
Hong Kong, Dec 19, 2014 - (ACN Newswire) - BeijingWest Industries International Ltd. ("BeijingWest International" or "the Company") is pleased to announce that an ordinary resolution on the acquisition of the entire issued share capital of BWI Europe Company Limited S.A., together with its subsidiaries (the "BWI Europe") being a leading manufacturer of automobile controlled and passive suspension products in Europe, by a wholly-owned subsidiary of the Company was successfully approved at the extraordinary general meeting of the Company held in Hong Kong on December 19. The board believes that the acquisition is a valuable step for the Company to expand its geographical reach to Europe and increase the product portfolio and customer base of the Group, therefore increasing its profitability and the Company's overall shareholder value.
According to the resolution, BeijingWest International has agreed to acquire from the Vendor the entire issued share capital of BWI Europe Company Limited S.A at the consideration of HK$997million which shall be settled in the following manners: as to HK$697 million, by the allotment and issue by the Company to the Vendor of 1,787,179,487 new Shares at the Issue Price; and as to the balance of HK$300 million, by (i) cash payment, (ii) the issue by the Company to the Vendor of the Convertible Bonds, or (iii) a combination of (i) and (ii), as agreed between the Purchaser and the Vendor.
BWI Europe is principally engaged in the design, research and development and manufacture of automobile controlled and passive suspension products for premium passenger vehicle manufacturers and the provision of technical support services. The automobile controlled and passive suspension business was previously owned by Delphi Corporation, a largest provider of mobile electronics and transportation system worldwide. The Company had obtained the authorization to use the intellectual property rights that were transferred to BeijingWest Industries Co., Ltd by Delphi, the previous owner of the suspension business of the BWI Europe.
BWI Europe is the sole manufacturer of the MagneRide controlled suspension systems in the world and the systems are popularly adopted by Ferrari, Audi, Land Rover and other super luxury car brands.
According to Ipsos, in 2013, the European market was considered to be the dominate market of suspension products. The report also estimates that the total sales volume of suspension products will reach about US$15.6 billion in the next four years, which will be driven by the growing demand for controlled suspension systems. The CAGR of the total production volume for controlled suspension systems is expected to reach about 11%, which is nearly double that of the total volume of overall suspension products.
Taking a leading role in the market, BWI Europe is the fifth largest manufacturer of automobile controlled and passive suspension products in Europe in terms of revenue in 2013 and accounts for approximately 3.4% to the total revenue in the automobile controlled and passive suspension products industry in Europe.
The Company recorded a CAGR of the total operating revenue of approximately 8% and a CAGR of the operating revenue for all controlled suspension products of approximately 12% for 2011-2013. The year-on-year growth rate of the operating revenue for all controlled suspension products for the 5 months period ended 31 May 2014 reached approximately 28%, which was twice as much as that of the total operating revenue for the same period. Aiming to create luxury driving experience for luxury automobile vehicles with its leading controlled suspension technology, the Company believes that its controlled suspension products, having driven the total revenue growth in the past with its growth rate exceeded the growth rate of its passive suspension products and its total operating revenue, will continue to accelerate the overall operating revenue growth of the enlarged Group in the future.
Upon completion of the acquisition, BeijingWest International will possess two production centers in Poland and the United Kingdom, two technology centers in France and Poland and the sales offices located in countries such as Poland, the United Kingdom, France and Germany.
Looking forward, BeijingWest International will further boost its leading position in the automobile controlled and passive suspension products market in Europe, continue to focus on R&D on its products to maintain competitive advantages in the market, strengthen its relationship with existing customers, attract new passenger vehicle manufacturers and increase penetration in the automobile aftermarket. In addition, it will also continue to enhance operational efficiency and actively pursue the expansion strategy of targeted acquisitions, joint ventures and partnerships with an aim to improve technology and supplement the offerings of the BWI Europe's business.
The successful approval for the resolutions at the shareholders' extraordinary general meeting indicates that the proposal has been well-recognized by all parties and the market is confident about the future development of the Company. The management team of the BeijingWest International commented that "the acquisition will provide a strong platform for the Group's further development, extend the geographical reach of the Group to Europe and enhance the Group's image as a listed company in the main board of Hong Kong Stock Exchange, thereby creating investment opportunities with great growth potential for investors. We are confident that the acquisition will increase not only the Company's portfolio and customer base, but also its profitability and overall shareholder value."
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