Splendor Technology Plans 145M Yuan Acquisition

Date:2011-10-21houhaizhen  Text Size:

October 21 -- Henan Splendor Science and Technology (002296.SZ), a provider of railway signalling communication products, plans to acquire a 50.87 percent stake in Beijing National Railway Luyang Technology for 145.03 million yuan from eight individual shareholders, reports Shanghai Securities News, citing a company filing.

Splendor Technology supplies software systems for railway signalling, while Luyang Technology is a provider of related hardware. At present, all the 18 local railway bureaus, and a great number of expressway and metro operators are customers of Luyang Technology.

According to Splendor Technology, the acquisition will enable the company to offer both software and hardware products and services in the railway signalling field, and increase its market share.

Of the total consideration, 109.07 million yuan will come from the excess funds raised from its initial public offering.

Through the end of the first half, Luyang Technology had total assets of 126.41 million yuan and net assets of 70.69 million yuan.

The core members of the management team had committed to remain in the company till the end of 2014, and had promised to deliver net profit of not less than 26.73 million yuan for full year 2011.

Splendor Technology had planned to fully acquire Luyang Technology in July through a private placement and cash offer.

With the rail sector adversely impacted by the high-speed rail collision at Wenzhou, Zhejiang province, in late July, Splendor Technology terminated its private placement, and decided to acquire the controlling stake through a cash offer instead.

Three senior managers of Splendor Technology had increased their shareholdings in the company right before share trading was suspended on June 28. The three senior managers are now under investigations and the results of the investigations have not been disclosed.

The board of Splendor gave a committment not to plan any other major asset restructuring over the next three months.

Share trading resumed today, and the stock fell by its daily limit to close the morning session at 23.4 yuan per share.

2005-2011 www.researchinchina.com All Rights Reserved 京ICP备05069564号-1