TIME INTERCON (01729) announced that on August 28, 2025 (after trading hours), the company, the seller (Jin's Investment Limited), and the guarantor entered into a sale and purchase agreement. Under the agreement, the company conditionally agreed to acquire from the seller the sale shares representing the entire issued share capital of De Jin Chang Investment Limited (the target company) for a consideration of HK$460 million, subject to the terms and conditions of the sale and purchase agreement.
The consideration for the sale shares will be paid through HK$130 million in cash and HK$330 million through the allotment and issuance of consideration shares to the seller by the company under general mandate. Additionally, under the sale and purchase agreement, the company shall procure the target group to repay shareholder debts not exceeding HK$190 million.
Upon completion, the target company will become a direct wholly-owned subsidiary of the company, and the financial results of the target group will be consolidated into the company's consolidated financial statements.
The target company is an investment holding company incorporated in the British Virgin Islands on March 23, 2009, and is a direct wholly-owned subsidiary of the seller as of the announcement date.
Since commencing business operations in 2001, the target group has been primarily engaged in the manufacturing and sale of copper wire products, which are widely used in precision electronic equipment, electrical appliances, computers, communication equipment, automobiles, medical equipment, aerospace equipment, and solar energy products. The target group's main customers are primarily listed companies and well-known manufacturers in the precision intelligent manufacturing, consumer electronics, and photovoltaic industries, with business operations spanning China and the Asia-Pacific region.
As of the announcement date, the target group owns three self-owned production facilities located in Huizhou, Nantong, and Thailand, and three leased production facilities located in Nantong, Ji'an, and Vietnam, with a total floor area of approximately 176,000 square meters.
In recent years, a significant characteristic of the global political landscape has been escalating trade tensions and intensifying technological decoupling trends, particularly between China and the United States. Although the group closely monitors these changes and adjusts business strategies to minimize unpredictable trade impacts on international clients, the directors have noted growing concerns that additional tariffs on certain components produced in China may lead to increased customer costs, reduced competitiveness of company products, and/or transportation difficulties.
Given the continued uncertainty in China-U.S. relations, exploring production in countries that have signed more viable trade agreements with the United States has become an option for the directors. The target group's established presence in Southeast Asia, with production facilities that follow strict quality control procedures and comply with the group's cable product manufacturing standards, provides an attractive solution.
Although certain production bases of the target group are located in Thailand and Vietnam, and neither country has finalized trade and investment framework agreements with the United States as of the announcement date, both countries are reportedly actively negotiating with the United States to create more favorable trade conditions, reduce high tariff risks, and provide a more business-friendly trading environment compared to having no agreements.
The acquisition will enable the group to diversify its dependence on critical copper wire supply from a single country. The target group's production bases located in countries surrounding China will also significantly diversify supply chain disruption risks. Since copper wire is the fundamental raw material for the group's cable products, supply disruptions could lead to production stagnation, delayed order deliveries, and significant financial losses. By ensuring cross-border copper supply, the group will establish a robust and resilient supply chain, ensure business continuity, and effectively diversify geographical and political risks.
Furthermore, the acquisition presents significant vertical integration opportunities for the group. By incorporating the target group's copper wire production, the group will not only strengthen control over the quality and specifications of this upstream raw material but also achieve more efficient product development. The directors believe this integration will enhance the group's ability to meet stringent industry standards and customer requirements, ultimately expanding the group's product portfolio range and strengthening competitiveness.