AutoBeta(AutoBeta.net)03/16 Report--

On the evening of March 15, Beijing Automobile issued an announcement saying that the company signed an equity transfer agreement with BAIC Group on March 13. According to the agreement, Beijing Automobile purchased 100% equity of Beiqi International and 24.78% equity of Beiqi Ruili held by BAIC Group, totaling RMB 80.5936 million yuan. Upon completion of the transaction, BAIC International will become a wholly-owned subsidiary of Beijing Automobile, and BAIC Ruili River will become a non-wholly owned subsidiary of Beijing Automobile.

According to public information, Beijing Automobile International Development Co., Ltd. was established on April 16,2013 with a capital of RMB 200 million Yuan by BAIC Group, and its current registered capital is RMB 125.244 million Yuan. BAIC International is the platform for overseas business of BAIC Group, mainly responsible for overseas business development, international business production base and sales management of BAIC Group's independent passenger vehicles, engaged in project investment, investment management and vehicle export business.

BAIC Yunnan Ruili Automobile Sales Co., Ltd. was established by BAIC Group, BAIC State and an independent third-party shareholder with a capital contribution of RMB 20 million, RMB 15 million and RMB 15 million respectively. The current registered capital is RMB 296.65 million. Beiqi Ruili is mainly engaged in the design, research and development, production and sales of automobiles and their parts, import and export of goods, import and export of technology, automobile leasing and other businesses.

According to the announcement of Beijing Automobile, from 2017 to the third quarter of 2019, BAIC International lost 350 million yuan, 220 million yuan and 146 million yuan respectively, while BAIC Ruili lost 23.15 million yuan, 25.43 million yuan and 21.54 million yuan respectively.

Beijing Automobile Co., Ltd. was founded on September 28, 2010, by Beijing Automobile Group Co., Ltd. and other six large enterprises initiated the composition, the current Beijing brand, Beijing Hyundai, Beijing Benz and accessories Benz four plates.

According to the financial report released by Beijing Automobile, Beijing Automobile realized revenue of 151.92 billion yuan in 2018, with a year-on-year growth of 13.2%; net profit of 4.43 billion yuan, with a year-on-year growth of 96.6%; in the first three quarters of 2019, Beijing Automobile realized revenue of 138.03 billion yuan, with a year-on-year growth of 14.8%; net profit of 3.004 billion yuan, down 21.1% year-on-year; Beijing Auto achieved revenue of 22.9 billion euros (179.2 billion yuan) in 2019, up 14% year-on-year, according to Beijing Auto's disclosure of financial information about Beijing Mercedes-Benz, up 15.7% year-on-year and accounting for 88% of Beijing's total revenue.

The acquisition of BAIC International and BAIC Ruili is conducive to optimizing the business structure of Beijing Automobile and strengthening the proportion of the Company's international business. At present, the domestic automobile market is cold, Beijing Automobile wants to jointly promote the advantages of Beijing Automobile in the market through BAIC International's experience in overseas market and BAIC Ruili's sales ability.

Beijing Automobile said that the investment in the construction of production bases of BAIC International and BAIC Ruili has been basically completed, and the overseas sales channels of BAIC International have matured. It is expected that BAIC International and BAIC Ruili will turn losses into profits in about 3 years. Of course, given the erosion of the current epidemic to major markets around the world, it is difficult for Beijing Automobile to promote the profitability of BAIC International and BAIC Ruili in a short period of time.

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