BYD Electronic (International), a unit of Chinese electric vehicle (EV) manufacturer BYD, has signed a deal with US-based Jabil to buy its mobile electronics manufacturing business in China for CNY15.8bn ($2.2bn).
In a statement, BYD Electronic said the deal includes product manufacturing business of Jabil in Chengdu and Wuxi, which is owned by Jabil Circuit (Singapore).
The deal also covers the manufacturing of components for existing clients.
For BYD Electronic, the deal is expected to bolster its customer base, diversify product portfolio, expand smartphone components business, and bolster group-wide customer and product structure.
BYD Electronics operates in a wide range of industries, including those involving robots, communication equipment, health gadgets, new energy vehicles, smart homes, game hardware, unmanned aerial vehicles, and the Internet of Things.
BYD Electronics CEO Wang Nianqiang said: “This acquisition will expand the business of smartphone components and mark the beginning of a new cycle of rapid growth. The acquisition will also ensure long-term sustainable development while creating value for customers and shareholders of the BYD Electronics.”
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Jabil CEO Kenny Wilson said: “If completed, the proceeds from this transaction will enable us to enhance our shareholder-centric capital framework, including incremental share buybacks. Additionally, it will provide opportunities for further investment in electric vehicles, renewable energy, healthcare, AI cloud data centers, and other end-markets.”
As part of the deal, the parties have agreed that they will make an effort to reach a binding agreement.
The completion of the acquisition contingent upon receiving all necessary regulatory clearances as well as other standard closing requirements.