(Yicai Global) May 9 -- China's bike-sharing brand Ofo Bicycle Co. has signed an agreement with established Chinese bicycle maker Shanghai Phoenix Bicycle Co. to buy at least 5 million bikes from the latter in the coming year.
The order will generate over CNY40 million in revenue for Shanghai Phoenix.
Shanghai Phoenix will also set up a research and development and manufacturing base for Ofo in East China. Shared bikes produced under the partnership will have a 'Phoenix' logo and be primarily put into service in and around Beijing and Shanghai. One million or so will also hit the road in overseas countries, including the US, UK and Singapore.
The agreement does not specify unit price, and fluctuating raw material prices could sow uncertainties as to the company's revenue, a statement by Shanghai Phoenix Enterprise Group Co. [SHA:600679], Shanghai Phoenix's actual controller, said. Ofo has already previously concluded partnerships with several bike makers. Bike-sharing companies have become bicycle makers' biggest clients.