Why did Fukuda sell its battery business?

On July 29th, the largest domestic commercial vehicle companies, Fukuda Motor Co., LTD., announced that it will sell 10% stake of Beijing Pride New energy battery Science and Technology Co., LTD. (hereinafter referred to as "the Pride"). If the deal finished, Fukuda Vehicle will get considerable income: the initial investment is 10 million yuan, and the market price is 475 million yuan, which means that Fukuda the deal will earn nearly 50 times earnings.

Fukuda cars have spending on new energy business for many years, it was built in 2004 of new energy technology center, the company's new energy car sales are also growing recently. In this situation, Fukuda if sell battery or not shares held a battery company an edge? Will be taking a stake in the company equity sell mainly because of the considerable income? For its batteries, Fukuda has given up? On the above issues, the reporter to send interview outline Fukuda equities, get a written response. Later, the reporter Fukuda staff invited again, to sell the company office in detail the cause of the battery business.

Fukuda car difficult to layout new energy bus, which sells battery enterprises

The company said the battery is not so important

Fukuda's offices in Beijing, north near six ring east ShaYang road, building roads on both sides of the building for Fukuda all, hundreds of meters are Fukuda boundary. Fukuda staff told reporters that time has more than 50 new energy bus after work every day to send staff to go home.

Fukuda, has nearly 30000 employees car is the largest commercial vehicle companies, Mr. Fukuda car not only production of commercial vehicles, its products cover the trucks, buses, passenger cars, etc., the new energy business mainly concentrated in the aspect of passenger cars. Recently, the company is going through a big thing is - to sell shares of battery factories will earn nearly 50 times earnings.

On July 29, Fukuda, according to the announcement to sell shares held 16 years of pride, east of the transaction object is the same for the listed company Seiko. The deal, Oriental Seiko will pay Mr Fukuda car 190 million yuan in cash, the other is 285 million yuan by the Oriental Seiko paid in 30.98 million its own shares.

Is 190 million yuan in cash, this alone has accounted for 46% of the Fukuda net profit in 2015.If the deal is completed, the income will also become the important source of Fukuda profits this year.

Fukuda car why want to sell their shares and hold intelligent packaging equipment mainly for the eastern Seiko co? No longer shares held pride, will be whether the new energy strategy as the key of Fukuda concerns will weaken the new energy business competitive?

In Fukuda automobile marketing in the building, Fukuda automobile relevant personage introduces to the reporter, said the industry, although the mainstream view is batteries for electric vehicles as the engine for a conventional car is important, but this does not mean that automobile enterprise must go to production power battery. On the one hand, with the development of new energy vehicles, there are many independent battery production enterprises had the first mover advantage and basis of accumulation, the vehicle enterprises and their relationship is the relationship between, is not a competition. On the other hand, the number of companies specializing in the production of batteries gradually increased after the automobile enterprise when purchasing power battery to have more choices and bargaining space.

For this problem, Fukuda also told our reporter written responded: "Mr Fukuda car's advantage lies in the vehicle integration and battery system integration technology and strong ability of market integration, and the development cost of production of the battery is larger, and the market competition fully, Fukuda automobile into the battery manufacturing industry, there is no advantage, Fukuda strategic direction and will therefore vehicle system, system components, development and test ability as a new energy system such as core business direction."

More important to high yield

Sell shares battery enterprises stake in Fukuda automobile, layout in the new energy business in for a long time. As early as in 2004, Mr. Fukuda car has built new energy automotive technology center. In the annual report 2010, Fukuda revealed in the 12th five-year plan for the five key industries, new energy is one of the five big industries, and the new energy industry contains power battery, energy storage battery and so on.1 - July this year, the new energy vehicles produced a total of 3822 vehicles, compared with the same period last year increased by more than 300 vehicles. The new energy vehicle is the hui, the mark, Mr. Bell, Jarno brands.

Fukuda car for a long time, therefore, are more attention on new energy business. In addition, Mr. Fukuda cars for the pride of the big customers for a long time, in 1 to 3 months of this year, pride of Fukuda automobile sales revenue accounted for 26% of its total revenue. So why is Mr. Fukuda car will cooperation battery business for many years to sell shares?

Fukuda chairman secretary office, a staff told reporters: "we in pride in 2010, is a kind of financial investment behavior. Now the battery product update quickly, and in the future will be more and more quickly. In this case, the Fukuda choose social resources to apply the principle of market pricing purchase battery is the optimal strategy."

In fact, sell shares plante maybe the most important reason for "earn more". Mr. Fukuda car at the beginning with only 10 million shares of pride, but now after selling equity can get an income of 475 million yuan., Fukuda written response to the reporter said: "the sale earned income is higher, while we watch the pride for the future development, but the yield nearly 50 times compared with the pride of share out bonus of future performance, the former obviously better, and after the transfer of shares does not affect the Fukuda procurement with pride."

Even sold battery plant stakes, but to have to give up the independent production of batteries, the Fukuda chairman secretary office staff said: "the sale of pride, this is a kind of commercial behavior, this and whether we own batteries. In addition, most of the domestic automotive mainstream companies are self-built battery factory. Although most of our company is currently purchased the battery, but also give up is not equal to the absolute independent production cell. We actually have our own technology reserve."

Reporter noted that Mr. Fukuda car in about the deal's announcement also remind investors: this matter should also submit Fukuda board of directors, the shareholders meeting review, still need to fulfill the China Beijing equity exchange publicly listed procedures; At the same time, the matters as part of the east Seiko material assets reorganization, has yet to be reported to the China securities regulatory commission and the relevant departments for approval.

Therefore, the transaction also has certain uncertainty. How does the progress of follow-up, the reporter will continue to focus on.

The page contains the contents of the machine translation.