On the evening of December 13, Times Electric (SH688187, share price of 47.38 yuan, market value of 66.879 billion yuan) announced that the company intends to acquire 100% of the shares of Hunan CRRC Commercial Vehicle Power Technology Co., Ltd. (hereinafter referred to as "CRRC Commercial Vehicle Power") with its own funds in cash, with a transaction amount of 107 million yuan.

According to the announcement, the main business of CRRC Commercial Vehicle Power is the R&D and manufacturing of high-end electric drives for new energy commercial vehicles, and its products cover new energy commercial vehicle motors, electronic controls, fuel cell DC/DC and other vehicle converter equipment, and do not involve the R&D and manufacturing of new energy vehicles and batteries. In the first half of 2024, CRRC Commercial Vehicle Power's operating income will be 87.3317 million yuan, and its net profit loss will be 39.4015 million yuan.

Times Electric said that this move is to promote the development of the company's new energy vehicle electric drive industry and build a whole industrial chain of "device + component + system" for new energy passenger electric drive. There are three counterparties to the acquisition, among which CRRC Zhuzhou is the direct controlling shareholder of the company, Xiangyang CRRC Motor is a wholly-owned subsidiary of CRRC Zhuzhou, the direct controlling shareholder of the company, and CRRC Electric is a company controlled by CRRC Group Co., Ltd., the indirect controlling shareholder of the company, so the transaction constitutes a connected transaction.

According to the company's information, Times Electric is mainly engaged in the research and development, design, manufacturing, sales and related services of rail transit equipment products. According to the strategic plan, Times Electric also lays out industries other than rail transit, and carries out power semiconductor devices, industrial converter products, new energy vehicle electric drive systems, sensor devices, offshore equipment and other businesses.

When applying for IPO in 2020, Times Electric wrote the prospectus to use 504 million yuan of raised funds to invest in the "R&D and application project of new energy vehicle electric drive system". In August 2022, Times Electric and FAW Equity Investment (Tianjin) Co., Ltd. each invested 250 million yuan to jointly establish a joint venture, which is mainly engaged in the development, manufacturing, sales, after-sales and service of electric drive systems for new energy vehicles (including motors, inverters, power transmission assemblies and components).

In an investor relations event on October 30, 2024, Times Electric said that the company's new energy vehicle electric drive business is very close to the stage of achieving benign operation. According to the third quarter report of 2024, in the first three quarters, the revenue of electric drive systems for new energy vehicles has reached 1.572 billion yuan, a year-on-year increase of 27.42%.

Cover image source: Visual China-VCG41N1307121233

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