This proposed new JV Agreement will see Tat Hong subsidiary Shanghai Tat Hong acquire a 76.4% stake in Huaxing Machinery, a provider of tower crane rental, heavy lifting equipment and related services to the construction industry in China, with a special focus on the Chinese nuclear industry.
The value of the purchase was not released.
Huaxing Machinery is one of the larger construction equipment leasing companies in China, with a base of operation in Yizheng City, Jiangsu Province and interests in Shanghai, Jiangsu, Zhejiang, Anhui, Shandong, Jiangxi and Guangdong.
After the acquisition is completed, the Company will be renamed “China Nuclear Huaxing Tat Hong Construction Machinery Co., Ltd” and its registered capital will be increased from RMB 6.6m to RMB 66.6m. The company will focus on the rental of construction machinery and heavy lifting equipment, installation and related engineering services and supplies for the nuclear and LNG power stations as well as railway stations.
Said Mr Roland Ng, Tat Hong’s President and Chief Executive Officer: “We believe we will enjoy significant competitive advantages as an early-mover and are delighted to build on the momentum generated since our entry in January. By allowing us to leverage on our strengths while tapping into Huaxing’s strong industry foundation and business network, this proposed acquisition will serve to accelerate our penetration into the PRC market and also function as a catalyst to spur our Group’s expansion in the region.”
Tat Hong’s proposed joint venture partners in the deal are China Nuclear Industry Huaxing Construction Company Limited (“China Nuclear”) and two private investors; Gao Song and Sun Zhao Lin.
The proposed joint venture is subject to satisfactory legal and financial due diligence reviews on the joint venture company to be carried out by the consultants of Shanghai Tat Hong and Sun Zhao Lin.
