Chinese humanoid robot maker UBTech Robotics is moving to lock down key manufacturing capacity, agreeing to pay nearly 1.7 billion yuan (US$237 million) in cash to take control of Shenzhen-listed mechanical component maker Zhejiang Fenglong as it pushes to scale up humanoid robot production.
The two-stage deal will begin with UBTech acquiring a 29.99 per cent stake in Fenglong from existing shareholders for 1.16 billion yuan, followed by a voluntary partial offer to buy a further 13.02 per cent for about 504 million yuan, according to a filing to the Hong Kong stock exchange on Wednesday.
The offer prices Fenglong’s shares at 17.72 yuan each, a 10 per cent discount to the company’s December 17 close of 19.68 yuan, before trading was halted.
After the first phase, UBTech will gain the right to nominate six of Fenglong’s seven board directors. Once both stages are completed, the Hong Kong-listed robotics firm expects to hold at least a 43 per cent stake in the company.
Fenglong manufactures engines for garden tools, automotive components and machine pressure-control systems. Its shares resumed trading on Thursday and immediately hit the 10 per cent daily limit, opening at 21.65 yuan.
