(Yicai Global) May 28 -- Shares of China's Jiecang Linear Motion Technology surged after the firm said it intends to purchase the Austrian parent of adjustable furniture maker LogicData Electronic & Software for EUR79.18 million (USD96.5 million) to improve its branding and sales channels.

Jiecang's stock price [SHA: 603583] jumped as much as 6.2 percent to CNY68.58 (USD10.80), after which it was 1.5 percent up in the afternoon.

The linear drive control systems producer will further invest EUR20 million in Logic Endeavor Group after acquiring all of the Deutschlandsberg-based company's equity, the Zhejiang province-headquartered firm said in a statement yesterday.

LogicData makes electromechanical parts for furniture such as office chairs and bed frames. It does business in Europe, the US, and China with around 270 employees worldwide, per the announcement.

The acquisition will improve Jiecang’s technological capabilities and enhance its brand influence amongst European and American high-end furniture suppliers, it explained.

LogicData is an industry leader in product development and sells its SlimDrive push rods and Compact-branded controllers to renowned furniture brands such as Herman Miller and Steelcase, Jiecang added.

The target firm had a rough year amid the Covid-19 pandemic. Logic Endeavor reported a net loss of EUR1.2 million (USD1.5 million) last year after logging a net profit of EUR6.9 million in 2019, according to its audited earnings report. Revenue fell 29 percent to EUR60.1 million (USD73.2 million). Its net assets tallied EUR37 million as of December 2020.

Editor: Emmi Laine, Xiao Yi