Chinese manufacturer of electric vehicles BYD Co Ltd announced on Monday that its subsidiary has agreed to purchase Jabil Inc’s mobility business in China for 15.8 billion yuan ($2.17 billion) from the Singaporean branch of the American manufacturing company.
The transaction will help BYD Electronic (International) Co’s (BE) expansion as it aims to take advantage of the potential growth in the industry by expanding its client base, product portfolio, and business of smartphone components.
As of 0328 GMT, BYD’s shares listed in Hong Kong were trading 2.5% higher at HK$229.2, while those listed in Shanghai were up 3.1% at 239.8 yuan. Shares of Jabil on the NYSE closed the previous day slightly lower.
The Chinese Electric Vehicles manufacturer will now purchase the unit that Jabil Circuit (Singapore), a manufacturer of printed circuit boards, created last month with product manufacturing operations in Chengdu and Wuxi.
Without providing any other information, BYD stated in a filing with the exchange that the acquisition “while improving BE’s market share of products, will effectively synergize with BE’s existing products, enhance the overall competitiveness, and ensure long-term sustainable development.”
Chief Executive Officer Kenny Wilson of Jabil said in a statement that the definitive agreement will allow the company, if the purchase goes through, to “enhance our shareholder-centric capital framework, including incremental share buybacks.”
The agreement will enable Jabil to increase its investments in “electric vehicles, renewable energy, healthcare, AI cloud data centers, and other end-markets,” Wilson noted.
