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.
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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.
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