(Yicai) March 21 -- Luxshare Precision Industry has agreed to buy more consumer electronics units from WingTech Technology, after purchasing nine in December, saying the acquisitions will help the Apple supplier increase its share of the iPhone maker’s supply chain.

Luxshare will pay CNY443 million (USD61.1 million) in cash for seven subsidiaries in WingTech’s consumer electronics system integration business, the Shenzhen-based firm said yesterday. 

The assets involved are Shenzhen Wingtech, Huangshi Wingtech, Hong Kong Wingtech, which includes Indonesia Wingtech, Kunming Wenyao Electronics Technology, India Wingtech, Wuxi Wingtech, and Wuxi Wenxun Electronics. The debt owed by WingTech and its affiliates to the target companies amounts to CNY4.1 billion (USD565.7 million).

Last December, Wingtech sold nine product integration subsidiaries to Luxshare, saying the deal would allow the Jiaxing-based company to exit the business and focus more on developing chips. Its Nexperia unit is a global leader in discrete and power chips and is also one of the world’s leading auto chipmakers.

The acquisitions will quickly strengthen Luxshare’s R&D teams and manufacturing resources in the area of Android-based consumer electronics system integration, helping to shorten the time needed to develop these capabilities in-house, it said.

The assets in the latest deal have well-established research, development, and manufacturing capabilities in original design and original equipment manufacturing of phones, tablets, laptops, and small home appliances, Luxshare noted.

Their capabilities will complement Luxshare's precision manufacturing strengths, greatly elevating its ability to deliver in-depth system-level solutions for smart devices and artificial intelligence hardware development, it added.

Luxshare’s stock price [SHE: 002475] closed down 1.4 percent at CNY39.86 (USD5.50) today, while the broader Shenzhen market retreated 1.8 percent.

Luxshare is a key player in precision manufacturing in China, covering a wide range of industries, including consumer electronics, communications, and automotive. Apple was already Luxshare’s biggest client as of 2023, accounting for three-quarters of the firm’s annual revenue.

Wingtech’s decision to offload its Android-focused consumer electronics system integration business comes after it contributed about 79 percent of revenue in the third quarter of 2024, but lost CNY1.2 billion (USD165.5 million), financial services firm CMB International pointed out, adding that the sale will ease the firm’s financial pressure and enhance its profitability.

Editor: Kim Taylor