Chinese multinational energy and industrial equipment manufacturer Shanghai Electric Group has received approval from the board to acquire a 100% equity stake in Ningsheng Industrial for around 3.1 billion yuan ($432.8 million) through its subsidiary Automation Group.
Ningsheng Industrial is the shareholding management platform behind Chinese factory automation solution provider Fanuc Robots and Fanuc International Trading, holding a 50% and 25% equity stake in the two, respectively, according to a recent exchange filing.
Fanuc International Trading is a joint venture between Fanuc Robots (Fanuc Robots and Ningsheng Industrial hold 50% and 25% equity interest in Fanuc International Trading, respectively), which is mainly engaged in international trade and re-exports in respect of industrial robot products, per the filing.
The acquisition will help Shanghai Electric Group and its subsidiary further the strategic layout of the automation equipment industry in the fields of lithium battery, photovoltaic, aviation, and automobile manufacturing.
Jointly established by Japanese factory automation firm Japan Fanuc and Shanghai Electric Group in 1997, Fanuc Robots has since provided sales, installation and services of industrial robots, intelligent machines and automated complete production systems for a wide range of manufacturing users.
Shanghai Electric Group sold its 50% stake in Fanuc Robots to its controlling shareholder Shanghai Electric Holding Group in August 2021 as the energy and industrial equipment maker sought to expand its industrial restructuring and plenish liquidity. The 50% stake was later transferred to Ningsheng Industrial in September 2022.
Upon completion of the acquisition, Japan Fanuc will retain its 50% stake in Fanuc Robots, while Automation Group will indirectly hold the rest of the equity interest.
The acquisition comes almost a month after the country’s securities regulator issued a six-point guideline to drum up support for merger and acquisition activities among listed firms on September 24.
In Q3, China’s domestic M&A market recorded a total of 1,226 transaction disclosures, down 2.5% quarter-over-quarter (QoQ) and 24.6% year-over-year (YoY), according to data from CVINFO, which tracks venture capital and private equity industry data in China. The M&A deal volume involving Chinese firms hit $66.3 billion, up 29.4% QoQ and 23.2% YoY.
