(Yicai) June 5 -- Shares in Advanced Fiber Resources climbed today after the Chinese optical component maker said it plans to acquire US electronics manufacturing firm Jabil's optical communications factory in Wuhan for USD17 million so as to expand its customer base, improve its product mix and strengthen its competitive edge.

Advanced Fiber Resources’ share price [SHE:300620] closed up 3.8 percent at CNY42.78 (USD6). Earlier in the day it surged 4.3 percent to CNY42.97.

Advanced Fiber Resources will pay USD17 million plus the net cash held by the factory at the time of the asset transfer and minus any outstanding expenses related to this transaction to become the sole owner of Jabil Technology (Wuhan), the Zhuhai-based firm said yesterday, citing the share transfer agreement signed with Jabil Circuit Investment China, the Chinese subsidiary of New York-listed Jabil, on June 3.

Jabil Technology (Wuhan) mainly produces optical components and subsystems. The factory reported unaudited net profit of CNY878,400 (USD122,000) in the first quarter, though it had a negative cash flow of CNY4.7 million (USD654,500) from operations. Revenue reached CNY64.1 million (USD9 million).

The plant has strong manufacturing and packaging capabilities for both active and passive optical components, as well as a solid customer base and supply chain, Advanced Fiber Resources said.

The acquisition is seen as a good strategic fit that complements Advanced Fiber Resources' core business. It will help the firm to improve its customer mix, expand its product lineup, hike production and enhance overall competitiveness, it added.

Advanced Fiber Resources mainly produces fiber laser components, optical communication parts and laser radar light source modules used in autonomous driving systems. Its main overseas clients include laser manufacturers Trumpf Group, Coherent and Spectra-Physics, as well as optical communication gear makers such as Ciena, Finisar, Lumentum, Cisco, Fabrinet, and Fujikura.

Last year, the company's overseas sales revenue reached CNY395 million (USD55 million), accounting for 39.5 percent of its total annual revenue, according to its 2024 annual report.

Editor: Kim Taylor