Sat, May 13, 2017 - Page 12 News List

KMC fully acquires three units in marketing push

By Ted Chen  /  Staff reporter

KMC Kuei Meng International Inc (桂盟國際) yesterday said it has fully acquired three of its business units in China in preparation to tap into the automotive market there.

KMC would spend NT$1 billion (US$33.11 million) or equivalent to purchase the units in Shenzhen, it said in a filing to the Taiwan Stock Exchange, adding that the deal would be concluded before the end of this quarter.

Beginning on July 1, the units’ output would be included in the company’s financial statements, the company’s filing said.

The acquisition involves an automotive engine variable valve timing system manufacturer established in 2004, a garage door chain drive systems maker established in 2007 and an automobile parts maker established in 2009, it said.

All three units supply Chinese automakers, it added.

KMC, one of the world’s biggest manufacturers of bicycle and motorcycle chains and motorcycle transmission kits, said it aims to leverage its expertise and supply chain in its core businesses in expanding to new markets with larger sales potential.

Expanding beyond the confines of the bicycle and motorcycle markets are vital in ensuring long-term growth, the company said.

The automotive and garage door units had a combined paid-in capital of 50 million yuan (US$7.24 million) and posted 23.9 million yuan in pretax earnings last quarter, KMC said.

The company said net income last quarter rose 31.22 percent annually to NT$248 million. Earnings per share were NT$2.06.

Sales during the period rose 17.4 percent annually to NT$1.12 billion, while gross margin was 45.9 percent, increasing by 3.74 percentage points from a year ago.

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