Securities Times reporter Sun Xianchao

Times Electric (688187) announced on the evening of December 13 that the company intends to acquire 100% of the shares of Hunan CRRC Commercial Vehicle Power Technology Co., Ltd. (hereinafter referred to as "CRRC Commercial Vehicle Power") held by CRRC Zhuzhou Institute, Xiangyang CRRC Motor and CRRC Electric with its own funds, with a transaction amount of 107 million yuan. After the completion of this transaction, CRRC Commercial Vehicle Power will become a wholly-owned subsidiary of the company.

In the counterparty of this transaction of Times Electric, CRRC Zhuzhou is the direct controlling shareholder of the company, Xiangyang CRRC Motor is a wholly-owned subsidiary of CRRC Zhuzhou, the direct controlling shareholder of the company, and CRRC Electric is a company controlled by CRRC Group Co., Ltd., the indirect controlling shareholder of the company.

CRRC Commercial Vehicle Power's main business is the R&D and manufacturing of mid-to-high-end electric drives for new energy commercial vehicles, and its products cover new energy commercial vehicle motors, electronic controls, fuel cell DC/DC and other vehicle converter equipment, and do not involve the R&D and manufacturing of new energy vehicles and batteries. Hunan CRRC Commercial Vehicle Power Technology Co., Ltd. has established three major electric drive platforms for buses, light trucks and heavy trucks, and can provide a full range of sub-products covering components (control panels, drive boards, stator and rotors, etc.), components (single motor, single electronic control), and systems (three-in-one, electric drive axles, etc.).

According to the balance sheet of CRRC Commercial Vehicle Power as of June 30, 2024, the book value of total assets is 431 million yuan, the book value of liabilities is 337 million yuan, and the book value of net assets is 93.3236 million yuan. According to the asset-based method evaluation, the book value of the net assets of CRRC Commercial Vehicle Power on June 30, 2024 was 93.3236 million yuan, the appraised value was 107 million yuan, and the value-added amount was 13.6014 million yuan, with an appreciation rate of 14.57%.

As a leading supplier of traction converter system in China's rail transit industry, Times Electric has comprehensive capabilities in R&D, design, manufacturing, sales and service, and is committed to becoming the preferred supplier of comprehensive solutions for global rail transit equipment. Times Electric said that this transaction is conducive to the company's construction of a new energy vehicle electric drive industry cluster, which is in line with the company's strategic planning.

The new energy vehicle industry has bright prospects and a huge industrial scale, which is a strategic emerging industry supported by the state and an important incremental industrial sector of Times Electric in the future.

According to Times Electric, the company is committed to becoming a world-class automotive electric drive parts and system integrator, and the mergers and acquisitions of commercial vehicle electric drive business are conducive to accelerating the realization of the planning goals of Times Electric's automotive electric drive industry, continuing to expand and strengthen the new energy vehicle electric drive industry sector, and realizing the continuous growth of the scale of Times Electric's electric drive industry and the steady improvement of its status.

It is worth noting that the passenger car and commercial vehicle business has a high degree of industrial synergy. At present, in order to enhance their core competitiveness, OEMs are deploying passenger cars and commercial vehicles at the same time, vigorously promoting the integration of passenger and commercial platforms, and putting forward new requirements for electric drive suppliers to have passenger and commercial platforms at the same time. At present, the leading companies in the electric drive industry have deployed both passenger car electric drive and commercial vehicle electric drive business, and enhance their overall competitiveness through business synergy.

Times Electric said that through the acquisition of the commercial vehicle electric drive business, in terms of technical collaboration, it can promote the sharing of R&D platforms among passengers and merchants, reduce R&D costs, improve R&D speed, and realize the extension of electric drive products in the middle and low power segment from passenger car electric drive to commercial vehicle electric drive; In terms of market synergy, it can use the resources of passenger car electric drive customers to promote the expansion of commercial vehicle medium and heavy truck electric drive business; In terms of supply chain collaboration, sharing suppliers and sharing supply resources through common logistics is conducive to improving the bargaining power of the supply chain, reducing procurement and production costs, and enhancing the market competitiveness of electric drive products.