(Yicai Global) April 17 -- Shares of Leader Harmonious Drive Systems and Sanhua Intelligent Controls rose after the Chinese firms unveiled a plan to jointly develop in Mexico by building an auto transmission components plant in the country.

Leader Harmonious [SHA: 688017], which makes precision transmissions, closed up 2.3 percent at CNY131.60 (USD19.16) today, after earlier surging by as much as 11.8 percent. Sanhua Intelligent [SHE: 002050], a producer of thermal management system parts for vehicles, rose 2.1 percent to end at CNY24.59 (USD3.58). Its shares jumped 8.6 percent in the morning.

The pair intends to set up a joint venture with a registered capital of at least USD10 million in Sanhua Intelligent's industrial park in Mexico, the two firms said in separate statements yesterday, citing a framework agreement for cooperation they recently signed. The JV will be responsible for the new plant’s investment and construction, they added.

Suzhou-based Leader Harmonious will control the factory, which will research, develop, produce, and sell harmonic drive gears, a type of transmission gear that reduces the gear ratio of a rotary machine to increase torque, as well as related products, the companies noted.

No further detail about the joint venture plant such as the investment amount, annual production capacity, or construction schedule were provided.

Leader Harmonious has accumulated 20 years of experience in the research and development of harmonic drive gears, according to its website.

Sanhua Intelligent's' industrial park in Mexico's Coahuila state has been the Shaoxing-based firm’s manufacturing base and logistic hub in the western hemisphere since 2014. The park had over 1,000 employees as of last October, according to Sanhua Intelligent's controlling shareholder Sanhua Holding Group.

Editor: Futura Costaglione