Shanghai (ZXZC)- Zhejiang Geely New Energy Commercial Vehicle Group (GCV), a wholly-owned subsidiary of Zhejiang Geely Holding Group, will acquire 15.24% stake in Hualing Xingma Automobile (Group) Co.,Ltd., an Anhui-based commercial vehicle manufacturer listed on Shanghai Stock Exchange, according to Hualing Xingma's announcement.

The acquisition will come after GCV signed on July 22 an agreement with Anhui Xingma Automobile Group Co.,Ltd. (called “Xingma Group” for short) and Ma'anshan Huashen Building Materials Industry Co.,Ltd. (called “Huashen” for short), the controlling shareholder and a wholly-owned subsidiary of Hualing Xingma.

(Hanma H7, photo source: Hualing Xingma)

In accordance with the latest announcement, Xingma Group holds a total of 84,680,905 shares in Hualing Xingma—60,544,793 of which are indirectly controlled via the subsidiary Huashen, representing 15.24% of total equity stake in Hualing Xingma. Upon completion of the transaction, all of these shares will be transferred to GCV.

According to the Anhui-based CV maker's earlier statements, it was soliciting the intended stake transferees from May 23 to June 5. GCV was the only one that submitted a letter of intent and relevant documents required for the application during that period, and paid an earnest money of 30 million yuan ($4,231,670) to Xingma Group.

Hualing Xingma, which began its life as Ma'anshan Building Materials Factory, went public on Shanghai Stock Exchange in April 2003. Public data show that it sold 16,795 heavy-duty trucks in 2019.

Once the transaction is completed, the actual control of Hualing Xingma will change to Li Shufu, chairman of Zhejiang Geely Holding Group Co.,Ltd. from Ma' anshan Municipal Government.

Some industry insiders reckon that Hualing Xingma not only boasts notable presence in China’s heavy-duty market, but also has formed some advantages in self-developed R&D platform, sales channel and after-sale service network, which are all favorable to Geely’s CV deployment.