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Xiaomi increases Zimi stake to 49.9 per cent
Posted on Friday, 22 May 2020 07:16
Xiaomi is acquiring a further 27.4 per cent of Zimi International for USD 102.84 million to gain access to technological and research and development (R&D) capabilities in electrical power supply and Internet of Things (IoT).
The Cayman Islands-incorporated, Beijing-headquartered electronics manufacturer will pay USD 25.78 million in cash and USD 77.06 million in 54.38 million new shares that represent a 0.2 per cent post-issue stake.
It noted the price of HKD 10.98 apiece equates to a discount of 13.5 per cent to yesterday’s close of HKD 12.70 and of 10.6 per cent to the five-day average finish of HKD 12.28 each.
Zimi is a high-tech company focused on smart hardware, mobile accessories and IoT products under its own brand, ZMI.
The group is involved in the R&D and production of advanced accessories ranging from power banks, chargers and wireless chargers, to data cables and intelligent home appliances.
In the 12 months ended 31st December 2019, it booked a pre-tax and net profit of CNY 382.03 million (USD 53.74 million) and CNY 326.10 million, respectively, compared to CNY 267.97 million and CNY 227.83 million in FY 2018.
Xiaomi said the acquisition, which takes its overall stake in Zimi to 49.9 per cent, provides a good opportunity to bolster its own technological competitiveness in 5G and artificial intelligence IoT.
The group added it can apply the power-related technology aspect of the business to its own smartphones and other IoT devices.
Not only should this lead to higher competitiveness, but it would pave the way for the standardisation of the power-supply of Xiaomi’s products to save costs.
The group noted Zimi’s R&D capabilities and industry resources and operating experience in power-related products, camera, speakers and other electronics in the IoT sector should bolster its own future ecosystem devices.
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