Gelonghui, June 16, 丨 Lianchuang Optoelectronics (600363.SH) announced that the company plans to use 100% of the shares of Jiangxi Lianchuang Zhiguang Technology Co., Ltd., a wholly-owned subsidiary, to invest 590.5 million yuan at an assessed cost of 590.5 million yuan to establish a wholly-owned subsidiary (hereinafter referred to as the “target company”) in the Nanchang Rinkong Economic Zone.
Due to business development needs, the company introduced new investors for it. The company plans to sign an “Equity Transfer and Repurchase Agreement” with Nanchang Rinkong Industrial Equity Investment Management Co., Ltd. (hereinafter referred to as “Rinkong Industrial Investment Company”). The company will transfer 33.02% of the target company's shares to Rinkong Industrial Investment Company at a price of 195 million yuan and assume the obligation to repurchase such shares in accordance with the agreement.
In the past three years, Lianchuang Zhiguang has mainly produced backlight products and is a core supplier recognized and valued by many well-known domestic mobile phone brands. Lianchuang Zhiguang's revenue is mainly revenue from backlight sources for communication products, revenue from automotive electric light sources, revenue from industrial control exclusive displays, revenue from tablet products, and other income. Due to the rapid popularity and upgrading of smartphones, sales volume will increase by 10% every year starting in 2021, and sales prices will be adjusted appropriately taking into account rising raw material prices.
After the equity transaction was completed, the company's holding of Lianchuang Zhiguang's shares was adjusted from direct ownership of 100% to indirect holdings of 66.98%. Lianchuang Zhiguang is still a holding subsidiary of the company and is still within the scope of the company's consolidated statements. After the company subsequently repurchases 33.02% of the shares held by Rinkong Industrial Investment Company according to the agreement, Lianchuang Zhiguang will still be a wholly-owned subsidiary of the company. This transaction will not have a significant impact on the company's operating performance this year.