TCL Electronics (01070.HK) announced that on May 13, 2022, the buyer TCL Electronics (Huizhou) Co., Ltd. (a subsidiary of the company) and T.C.L. Industrial (Hong Kong) entered into the acquisition agreement, according to which, T.C.L. Industrial (Hong Kong) conditionally agreed to sell, while the buyer conditionally agreed to acquire a 100% stake in the target company TCL Digital Technology (Shenzhen) Co., Ltd., with a cash consideration of RMB 116 million.

The target company and its subsidiaries are mainly engaged in investment holding business. The investment includes equity investments in different companies mainly engaged in the development, manufacture and distribution of LED modules, various wireless modules, smart display products, photovoltaic panels, structures, circuit boards, metal and precision components, and the provision of advisory services. The target company holds such investments either directly or indirectly through its wholly-owned subsidiaries.

According to the company, the Target Group holds stakes in some of the Group's major raw material suppliers, including, but not limited to, suppliers of wireless connection modules, LED display modules, multilayer printed circuit boards, precision metal components, precision metal stamping parts, injection molded parts and optoelectronic components. The Group believes that the acquisition is conducive to the development of cooperative relations with relevant suppliers, the stable strengthening of the Group's supply chain and the promotion of its synergy, which will help the Group to cope with soaring raw material prices and fierce competition for raw materials in the market.

In addition, as the business performance of the investee of the Target Group is good, the Group believes that the continued growth of the investee of the Target Group will increase the future profits of the Target Group and thus make a further contribution to the performance of the Group.