Hongqiao Group (08137) plans to acquire 51% of Juneng (Jiangsu) Power Technology's shares for 424.8 million yuan

According to the Zhitong Finance App, Hongqiao Group (08137) announced that on August 21, 2026, the company entered into an acquisition agreement with Lianfengtai Technology, Geely Technology Group and the target company. Geely Technology Group has conditionally agreed to sell, and the company has conditionally agreed to acquire 51% of the shares of the target company Juneng (Jiangsu) Power Technology (through the wholly foreign-owned enterprise entity being set up by Lianfengtai Technology) at a cost of RMB 424.8 million (or HKD equivalent).

Upon completion, the target company will become a non-wholly-owned subsidiary of the Company, and its financial results will be consolidated in the Group's financial statements.

As of the date of this announcement, Lianfengtai Technology is establishing a wholly-owned foreign-owned enterprise (wholly foreign-owned enterprise entity) in China. The entity will be wholly owned by Lianfengtai Technology, and the Company will acquire target shares through this wholly foreign-owned enterprise entity. According to the acquisition agreement, the Company and Lianfengtai Technology must complete the establishment of the wholly foreign-owned enterprise entity, facilitate it to complete the required foreign direct investment foreign exchange registration, and promote it as a buyer to become a party to the acquisition agreement after it is registered and established. The wholly foreign-owned enterprise entity will then assume all the rights and obligations of the buyer under the acquisition agreement, which will take effect from the date of the acquisition agreement.

The target company is a three-power (battery, motor and electronic control) power system integrated solution provider focusing on low voltage scenarios, and has simultaneously developed a dual-core business model consisting of R&D, production and sales of such solutions and new energy lithium-ion batteries. The target company has complete low-voltage tri-electric support delivery capabilities, and can output integrated power system solutions integrating batteries, modules and battery management systems (BMS) to customers. It develops and produces square aluminum-shell lithium iron phosphate (LFP) batteries as the core supporting products of the solution. Currently, related systems and battery products are mainly used in small low-voltage power vehicles such as electric two-wheelers and tricycles.

The target company plans to expand the application of related products and solutions to commercial vehicles, small power, power exchange and intelligent robots to expand product and customer coverage.

The target company also plans to expand overseas markets, including R&D and business layout for oil-to-electricity and solar range extension solutions related to miniature new energy vehicles; in addition, the target company is developing sodium-ion battery-related technology (including cathode materials and battery products) as a potential new business direction other than the existing lithium battery business.

The acquisition will enable the Group to expand its lithium battery business and be in line with the Group's business development strategy for the following reasons:

(1) The acquisition will increase the scale of the Group's lithium battery business. Upon completion, the target company will become a subsidiary of the Company, and its financial results will be consolidated into the Group's financial results. This will enable the Group to further develop its lithium battery business along with its existing resource business.

(2) The target company has expanded its product range from a single cell to integrated system solutions including batteries, motors, electronic control systems and battery management systems. Therefore, the acquisition will broaden the Group's range of products and services and support its business development in the two- and three-wheeler markets.

(3) The acquisition will also enable the Group to integrate the target group's business with the Group's existing technology and supply chain resources. The Group intends to use these comprehensive resources to develop its lithium-ion battery business in the domestic tricycle market and overseas markets, including Southeast Asia.

(4) In view of the above situation, it is anticipated that the acquisition will complement the Group's existing business and support its future development.