Zhitong Finance App News, Zhongda Group Holdings (00139) announced that on May 8, 2024, the company signed a conditional joint venture agreement with FMC Cayman regarding the establishment of a joint venture to develop the smart and new energy vehicle market, including the production, design, R&D and sales of smart cars and related after-sales services. After subscribing for shares in the joint venture, the joint venture's issued share capital will be HK$50 million, of which 90% will be owned by the Group and 10% will be owned by FMC Cayman.
The directors have been actively seeking opportunities to expand the scope of the Group's business. As environmental awareness increases, the company believes that NEVs have broad prospects. The proposed strategic cooperation and joint venture agreement under the MOU will enable the Group to participate in the NEV business. Furthermore, the Group can use the expertise and experience of FMC Cayman (as a joint venture partner) to enable the Group to enter this market competitively.
The directors believe that the terms and conditions of the joint venture agreement are fair and reasonable and conform to the overall interests of the company and its shareholders.
Furthermore, on May 8, 2024, the company signed a memorandum of understanding on strategic cooperation and investment with FMC Cayman.
The contracting parties are expected to establish a joint venture. After the establishment of the joint venture, the Group will assist the joint venture to further raise RMB 250 million as working capital to develop its business.
FMC Cayman will or will seek to grant the joint venture Byton trademark and related intellectual property rights (intellectual property license) for a temporary period of 3 years, subject to the actual terms of the licensing agreement. Within 3 years from the date of establishment of the joint venture, the Group can acquire FMC Cayman's shares at a valuation of no more than US$630 million in FMC Cayman's overall value. If the joint venture can meet the sales plan or complete the acquisition of FMC Cayman, the intellectual property license will automatically be renewed. If the joint venture is unable to complete the sales plan, FMC Cayman has the right not to renew the intellectual property license after the expiration of 3 years.