(Yicai Global) Aug. 24 -- Jiangsu Akcome Science & Technology Co. [SHE:002610] (Akcome Science) said that to further expand its solar power plant business, it plans to buy a 38.4-percent stake in Suzhou Akcome Energy Engineering Technology Co. (Akcome Energy) from ABC International Investment (Suzhou) Co. and 19 other shareholders for USD120 million (CNY806 million).

Since both Akcome Science and Akcome Energy have Jiangsu Akcome Industrial Group Co. as their controlling shareholder and Zou Chenghui, who indirectly owns 61.6 percent of the target company, as their actual controller, the deal constitutes a connected transaction that will give Zou and Akcome Science a combined 100-percent stake in Akcome Energy.

The audited net book value of the target firm's equity is CNY664 million, and its appraised value is CNY2.11 billion, 217.67 percent or CNY1.446 billion more than the book value.

The parties involved negotiated a company valuation of CNY2.1 billion for the deal and priced the 38.4-percent stake at CNY806 million.

Akcome Energy is a leading provider of new energy system solutions in China and mainly engages in the development and construction of solar generating stations, Akcome Science said. Akcome Energy projects its net profit will be CNY188 million, CNY205 million and CNY240 million this year, next year and in 2019, respectively.

Akcome Science said it primarily produced and sells solar accessories and backs, operates and maintains solar stations. The deal will help it further improve its industrial chain to cover all solar plant-related businesses, the group said.