China Automotive Systems To Buy 51.0% Equity Control Position In Fujian Qiaolong

(RTTNews) - China Automotive Systems Inc. (CAAS), a power steering components and systems supplier in China, announced Monday that it reached an agreement to acquire a 51.0% equity control position in Fujian Qiaolong Special Purpose Vehicle Co., Ltd.

The total purchase price is approximately $3.0 million in cash. Upon completion of the acquisition, CAAS will further provide a loan of RMB 30.0 million or $4.8 million to Fujian Qiaolong at an annual interest rate of 8.5% to further its expansion. The detailed terms of the loan will be negotiated separately. No other terms of the acquisition were disclosed.

Fujian Qiaolong was founded in 1993 and currently produces special emergency vehicles (emergency power source vehicles, heavy flow drainage vehicles, emergency drainage vehicles, etc.) and civil service vehicles (vending vehicles, garbage trucks, medical waste transportation vehicles, etc).

Located in Longyan, Fujian Province, almost 200 people including more than 20 technical personnel are employed at Fujian Qiaolong, which has production capacity to modify approximately 4,000 special services vehicles annually.

For the 2013 year, Fujian Qiaolong had revenues of approximately RMB 41.6 million with net earnings of about RMB 6.5 million. Registered capital is approximately RMB 20 million with assets totaling RMB 67.5 million as of the end of 2013.