(Yicai) Jan. 14 -- Chinese Apple supplier Luxshare Precision Industry has taken its battle over the Indian assets it had agreed to buy from smartphone assembler Wingtech Technology into the courtroom, after the government seized facilities involved in the deal.

Luxshare has filed a request for arbitration with the Singapore International Arbitration Centre, requesting that its deal to buy Indian manufacturing facilities from Wingtech be terminated, it announced late yesterday, noting that the local government has seized relevant assets, making the transfer of ownership impossible.

"Based on the substantive delivery obstacles caused by reasons attributable to Wingtech, the objective of the asset acquisition agreement can no longer be achieved," Luxshare pointed out.

The transfer of Wingtech India assets had been completed, with only relevant land still requiring cooperation from Luxshare to proceed with the ownership change, the parent company said Jan. 12. Wingtech has demanded multiple times that the counterparty's unit Luxshare Liantao pay the remaining transaction consideration of about CNY160 million (USD22.9 million), but this has not happened yet.

Luxshare Liantao has paid part of the transaction consideration as agreed, but because the relevant assets have been seized and frozen, the deal cannot be completed, its parent firm stressed. In addition, the unit has issued a termination notice to Wingtech India, requesting it to refund the already paid INR2 billion (USD22.2 million).

Wingtech began divesting its original equipment manufacturer and original design manufacturing assets to shift its focus to its semiconductor business last year. It sold an integrated business asset package to Luxshare Precision and associated firms for CNY4.4 billion (USD630.6 million) in May.

Aside from the Indian case, the sale of other Wingtech assets has proceeded relatively smoothly.

Wingtech's product integration business has been in the red for many years, while the company was included in the US Department of Commerce's trade restriction list at the end of 2024.

After being included in the Entity List, Wingtech faced difficulties in securing new orders, the company previously said. In January last year, it also warned of the potential risk of tax penalties for its India subsidiary.

Shares of Wingtech [SHA: 600745] rose 1.7 percent to CNY39.23 (USD5.62) apiece as of 11.10 a.m. in Shanghai today. Luxshare [SHE: 002475] climbed 0.2 percent to CNY54.69 in Shenzhen.

Editor: Martin Kadiev