Chinese Electronics Group Luxshare Swoops On German Parts-maker Leoni
German auto supplier Leoni said Tuesday it had been bought by Luxshare, a Chinese supplier of electrical components, as the European auto industry struggles to keep up with Asian competitors.
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Chinese Electronics Group Luxshare Swoops On German Parts-maker Leoni
German auto supplier Leoni said Tuesday it had been bought by Luxshare, a Chinese supplier of electrical components, as the European auto industry struggles to keep up with Asian competitors.
Chinese Electronics Group Luxshare Swoops On German Parts-maker Leoni
September 17, 2024German auto supplier Leoni said Tuesday it had been bought by Luxshare, a Chinese supplier of electrical components, as the European auto industry struggles to keep up with Asian competitors.
Luxshare will become Leoni's majority shareholder with a stake of 50.1 percent, the German group said in a statement.
The Chinese group paid some 320 million euros ($356 million) for its controlling stake in Leoni, according to figures published by Luxshare on Friday.
The rest of the shares will be held by Austrian businessman Stefan Pierer, who took the supplier private last year at the end of a difficult restructuring process.
Under the agreement, Leoni's cable division will be spun off and sold to Luxshare's Singapore-based subsidiary Time Interconnect, the German group said.
Luxshare's investment in the German group would "enhance Leoni's competitiveness across all fronts", Leoni CEO Klaus Rinnerberger said in the statement.
Luxshare's CEO Grace Wang said the deal "marks a pivotal step in our journey towards becoming a global leader in the automotive sector".
Leoni, which employs some 95,000 people worldwide, went through major restructuring in 2023 after the failed sale of its cable division left it in financial trouble.
The saga saw the Nuremberg-based parts-maker delist from the Frankfurt Stock Exchange and businessman Pierer take full control.
The German auto sector has come under increasing pressure from the move away from combustion engines to electric cars and the rise of international competitors, notably from China.
The challenges in the sector have seen a slew of suppliers, including ZF, Bosch and Webasto, announce job cuts.
Apple Supplier Luxshare Drops as iPhone 16 Orders Miss Expectations
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DATE: Sep 18 2024
Apple is facing strong competition in China from domestic rivals such as Huawei Technologies. Shenzhen-based Huawei released the world's first bi-fold smartphone shortly after Apple released the iPhone 16. Another problem for the US tech giant is that its new artificial intelligence-enabled functions, intended to be a major selling point for the iPhone 16, are currently not useable in the Chinese mainland.
Luxshare became an Apple supplier in 2011 and now offers services for products including the Apple Watch, AirPods, and Vision Pro, as well as the iPhone. Apple has become its biggest client, with about three quarters of its total revenue last year contributed by the California-based firm.
In recent years, Luxshare has been expanding into the auto parts business to reduce its dependence on Apple. On Sept. 13, the company announced a plan to acquire a 50.1 percent stake in German auto parts firm Leoni and all of a wholly owned Leoni unit for EUR525 million (USD584.3 million).
Leoni, a leading cable, wire and harness systems solutions provider worldwide, makes products that are also used in communications and the pharmaceutical sector, as well as autos. Last year, it had total revenue of EUR5.5 billion (USD6.1 billion) and a net loss of EUR128 million, according to a statement from Luxshare.
In the six months ended June 30, Luxshare increased its net profit 24 percent year on year to CNY5.4 billion (USD761.7 million), with revenue rising 6 percent to CNY103.6 billion (USD14.6 billion), its latest financial report showed. Revenue from the auto parts business made up 4.6 percent of the total, up from 3.3 percent a year earlier.
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