Qinshang plans to invest 655 million to acquire 6.15% equity of Philips Lumen

According to reports, Qinshang Optoelectronics announced on the evening of September 17 that the company plans to indirectly invest US$100 million (equivalent to about 654.84 million yuan) in Philips Lumen, a spin-off of Royal Philips of the Netherlands, by changing all the remaining funds of the company's LED indoor lighting project, all the company's remaining super-raised funds, all the remaining funds of the company's LED outdoor lighting and landscape lighting projects, and part of the company's working capital to indirectly acquire 6.15% of Philips Lumen's equity.

Change the use of raised funds

Information shows that in early 2011, the company publicly issued 46.835 million common shares to the public at a price of 24 yuan per share, raising a total of 1.12404 million yuan. After deducting issuance expenses, the actual raised funds were 1.0568154 million yuan. One of the investment projects raised this time is the "LED indoor lighting project."

The company stated that the project originally planned to build a new LED indoor lighting production system to create a complete LED indoor lighting product manufacturing unit including die-casting, injection molding, machining, packaging and lamp assembly. The total planned investment of the project is 141.1195 million yuan. LED display screen

Due to the overall economic downturn in recent years, the growth rate of the LED lighting application market has slowed down. In particular, the indoor lighting market demand release rate is significantly lower than industry expectations. In addition, the current LED indoor lighting product production capacity is relatively excess, the industry concentration is insufficient, and the market share of a single enterprise or brand with insufficient channel advantages is relatively scattered.

The announcement stated that the company began to pay more attention to channel construction in 2013, but it is still in the early stage of market development. If the investment of funds is accelerated prematurely to expand the production scale of the investment project, it will cause overcapacity and waste of funds in the early stages of the project, and the subsequent depreciation expenses, management expenses, etc. will have a greater impact on the company's operations, so the company has accordingly delayed the construction progress of the project. In combination with the actual market development situation and the company's latest strategic considerations, in order to save operating costs accordingly, the company's directors reviewed and approved the proposal to postpone the investment project with raised funds.

The company stated that as of June 30, 2015, a total of 3.3532 million yuan of raised funds had been invested in the project, accounting for 2.38% of the total investment. The remaining funds of the project were 153.4816 million yuan (including interest). The company plans to use all remaining funds of the project to invest in Philips Lumen.

Invest in Philips Lumen

Philips Lumen is a leading global technology company that mainly supplies LED components to the lighting industry and LED and traditional lighting components to the automotive industry. Its automotive, LED flash and LED chip business areas have achieved market leadership. The company had revenue of approximately $2 billion in 2014 and EBITDA of approximately $410 million in 2014. The company's business mainly consists of general lighting, automotive lighting, and consumer lighting.

Among them, in 2014, the sales of Philips Lumen's general lighting business exceeded US$400 million. Products include high-power, color, integrated packaging, medium-power, low-power, Matrix (L2) and reverse-mounted chips and emerging products; sales of traditional automotive products were nearly US$900 million. In the same year, automotive LED sales were nearly US$300 million. Traditional automotive products include halogen lamps, xenon lamps, high-efficiency light bulbs, signal lights and mobile accessories. Automotive LED products include high-power and medium-power products; sales of consumer products are nearly US$400 million. Products include high-power, mid-power, low-power, Matrix(2) and solid-state backlight LED solutions for televisions, mobile devices and computer displays.

The company stated that the implementation of the project is in line with national industrial policies and will improve and consolidate the company's leading position in the field of semiconductor lighting through industrial integration, strengthen the company's strength, and improve the brand's image. The company plans to invest a total of US$100 million in Philips Lumen this time, and use the company's own funds to invest in the insufficient portion of the above-mentioned raised funds.

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