Wired News – A Subsidiary of China Yuchai Acquires China's Jining Yuchai Engine Company
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LONDON, UK / ACCESSWIRE / November 30, 2017 / issued a free report on China Yuchai International Ltd (NYSE: CYD), which is readily accessible upon registration at www.active-investors.com/registration-sg/?symbol=CYD as the Company’s latest news hit the wire. On November 28, 2017, the Company announced that its main operating subsidiary, Guangxi Yuchai Machinery Company Limited (GYMCL), has acquired all the issued shares in Jining Yuchai Engine Company Limited (Jining Yuchai), a China based Company that develops, produces, and sells 4D2.0L diesel engine and its parts for passenger vehicles. Sign up now for our free research reports at:
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GYMCL paid approximately RMB 250 thousand to Jining Yuchai's existing shareholders (vendor) to complete the acquisition. GYMCL had already taken control of Jining Yuchai's management based on the agreement that it had signed with the vendor in October 2014. The agreement with the vendor had an irrevocable option, wherein GYMCL had to acquire Jining Yuchai’s shares which gave it management control over the Chinese Company. The current transaction is just a formality and gives GYMCL control of Jining Yuchai's equity on top of the management control that it already has over the Company. GYMCL has already been consolidating the financial reports of Jining Yuchai along with its own financial statements since the time that it took over the management controls over the Company.
History
Jining Yuchai was a Joint Venture (JV) Company formed by GYMCL and Zhejiang Geely Holding Group Co., Ltd in February 2008. The JV was named Jining Yuchai and was formed to manufacture diesel engines for passenger vehicles in China. The main product of the JV was a 4D2.0L diesel engine backed by new diesel engine technology developed by and purchased from Geely. TheCompany planned to further develop this technology and commercialize it to manufacture diesel engines to match Euro-5 certification and meet China's evolving emission standards. The JV Company had annual capacity to manufacture 300,000 engines and would initially start with production of 50,000 diesel engine units and later addition capacity to scale up production to 150,000 units per annum. GYMCL was the majority partner in the JV with 70% holding.
However, in October 2014, GYMCL sold off its entire 70% stake in Jining Yuchai in October 2014 to an undisclosed vendor after consulting with its JV partner. At that time, the Company had not given any reasons for its decision nor disclosed the financial terms of the stake sale.
About China Yuchai and GYMCL
China Yuchai International Limited (CYI) is a Bermuda holding Company established on April 29, 1993, and is a subsidiary of Singapore-based Hong Leong Asia Ltd. The Group’s principal operating subsidiary Guangxi Yuchai Machinery Company Limited (GYMCL) is one of the largest engine manufacturers in China and is based in Yulin City, Guangxi Zhuang Autonomous Region in southern China. GYMCL was founded in 1951 and is a well-respected brand with significant market share in China
GYMCL manufactures, assembles, and sells a wide variety of light-, medium- and heavy-duty engines for trucks, buses, passenger vehicles, construction equipment, and marine and agriculture applications in China. GYMCL also produces engines for diesel power generators. The engines produced by GYMCL range from diesel to natural gas and hybrid. engines. The Company distributes its engines directly to auto OEMs and retailers and provides maintenance and retrofitting services throughout China. GYMCL sold 320,424 engines in FY16.
Stock Performance Snapshot
November 29, 2017 - At Wednesday’s closing bell, China Yuchai International’s stock marginally dropped 0.69%, ending the trading session at $25.97.
Volume traded for the day: 126.88 thousand shares, which was above the 3-month average volume of 82.12 thousand shares.
Stock performance in the last month – up 15.94%; previous three-month period – up 39.92%; past twelve-month period – up 117.14%; and year-to-date - up 88.05%
After yesterday’s close, China Yuchai International’s market cap was at $1.05 billion.
Price to Earnings (P/E) ratio was at 9.01.
The stock has a dividend yield of 3.47%.
The stock is part of the Industrial Goods sector, categorized under the Diversified Machinery industry. This sector was up 0.2% at the end of the session.
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