On the evening of August 22, Lake Electric issued an announcement, Company with its own capital of 273 million yuan to buy a company controlling shareholder lake electric investment group (hereinafter referred to as “lake investment”) held in suzhou lihua technology co., LTD. (hereinafter referred to as “unilever technology”) 81.7341% equity and RayValHoldingCompanyLimited unilever held a 14.8114% stake in science and technology, A total of 96.545% equity.

After the completion of the acquisition, the company can use its strength in the core parts business field, through the business integration with Lihua Technology to form synergies, promote internal business integration and technological innovation, and further expand the electronic control business in the fields of communications, industrial control, medical care and new energy.

According to the announcement, Lihua Technology is an EMS enterprise with decades of experience in electronic manufacturing and processing services in China, providing manufacturing and supply chain solution services to OEM companies in various industries. Independent R & D team, professional PCBA manufacturing equipment, sound quality system and professional project team, Lihua Technology has a good reputation in the domestic EMS industry, and long-term cooperation with European and American industry leaders; Lihua Technology services business involves communication, industrial control, medical and other fields. Global industrial science and technology is developing rapidly, the market is huge, and the future can be expanded. At present, the sales scale of Lihua technology is about 1 billion yuan, and the development of customers is relatively stable. Lihua Technology has established deep cooperation with them, and the future development prospects are good.

Lake Electric is a home appliance enterprise with high-speed motor as its core technology, home cleaning, air purification, water purification, kitchen appliances and other green intelligent small household appliances, garden tools and core supporting parts as its main business.

In daily business operations, Lake Electric will also have related transactions with Lihua Technology. According to the disclosure of Lake Electric’s 2022 annual report, the total amount of connected transactions of purchased goods generated by the company and Lihua Technology and its subsidiaries in the year was 31.3107 million yuan, and the company sold 1,4125 million yuan of goods to Lihua Technology and its subsidiaries.

Financial data show that Lihua Technology will achieve operating income of 1.059 billion yuan and net profit of 48.9909 million yuan in 2022; From January to June 2023, Lihua Technology achieved an operating income of 480 million yuan and a net profit of 21,396,900 yuan. As of June 30, 2023, the net assets of Lihua Technology were 285 million yuan. The valuation of the transaction is essentially in line with Lihua’s net assets.

Leck Electric said that the electronic manufacturing services (EMS) industry has good development prospects, the market is huge, and the industry is currently in a period of rapid growth and development. After the completion of the acquisition, the listed company can use its strength in the core parts business field to form synergies through business integration with Lihua Technology, promote internal business integration and technological innovation, further expand the electronic control business in the fields of communications, industrial control, medical care and new energy, expand the business scale of the company, and provide new growth points for the company’s future performance. At the same time, it can reduce affiliated transactions, which is conducive to the long-term development and strategic planning of the company.

Recently, Lake Electric also disclosed the semi-annual results forecast for 2023, and it is expected to achieve a net profit of 495 million yuan to 605 million yuan in the first half of the year, an increase of 2.69%-25.51%. The reason for the pre-increase in performance is that the company adheres to independent innovation, grasps market opportunities, continuously optimizes the business and product structure, focuses on superior products, and increases the proportion of high value-added businesses; At the same time, it effectively promotes cost reduction and efficiency measures such as organizational structure optimization and operating cost control, and the exchange income brought by the appreciation of the US dollar has a positive impact.