ACES announced to increase the investment in NTGEC to be its subsidiary for entering China automotive electronics market



ACES Electronics Co., Ltd. (ACES Electronics , Stock code 3605) passed the board of directors’ meeting and announced that ACES (Kunshan) subsidiary to add investment in Nantong Great Electric (NTGEC) and increase its stake ratio up to 55%. Also it will obtain certain stockholders’ part of stock right by cash and increase cash investment in NTGEC call warrant. The total investment amount is CNY82.25 million and the investment will be realized at the end of 2015 and then Nantong will become a subsidiary of ACES.


From 2015, ACES Electronics obtained MEC 70% stock right by public tender offer way and estimated to get 55% stock right of NTGEC. Since 2016, new ACES group will not only develop its core connectors but also extend high speed wires by MEC sales. Also, NTGEC will be in charge for the car connectors and wires in China automotive market. NTGEC products include NB, Consumer electronics, handheld devices, industrial industry and car industry….application market. The acquisition will realize company’s goal which made in ten years ago to develop electronics and car industry collaboratively and balance.


NTGEC established in 2002, a China car wires production factory. It supplies to Beiqi Group, Dongfeng Group, Guangzhou Automobile Group, Valin Automobile Group, Weichai Group, Sany Group and other mainland national brand depot…..including passenger car, new energy electric vehicles, light trunk, heavy trunk, SUV car, PK car, mechanical car, engines, agricultural machinery garden vehicles and other vehicles types. Car wires product lines are variety and has market share in China. In pass ten years, NTGEC has 30% revenue compound annual growth rate (CAGR). It is high growth and 2015 will up to CNY 4 billion revenue scale.


ACES decided to invest NTGEC 28.35% stock right in 2014 Q4 and launch the product development. However, both of them want to speed up their resource integration and extend the strategy cooperation items and China car market’s arrangement. Therefore, this time, ACES (Kunshan) subsidiary add the investment in NTGEC including cash acquisition of stock right, CNY 17500 thousand transaction and call warrant NTGEC’s cash investment. The additional stake investment will consist of acquiring stakes from Nantong's existing shareholders at a total of CNY17.50 million and subscribing to new shares to be issued by Nantong for CNY64.75 million. The investment will be realized at the end of 2015. ACES will increase NTGEC’s stake ratio from 28.35% currently to 55% and then NTGEC will become a subsidiary of ACES.