China’s Doublestar to acquire Shandong Hengyu Tech in US$134 million deal

March 20, 2019

Chinese game-player Qingdao Doublestar Group plans to acquire fellow Chinese tyre-maker Shandong Hengyu Technology Group for US$134 million (CNY899 million) in a careful expansion and capacity optimisation plan in 2019.

Dongying City, Shandong-based Hengyu Technology Group – also known as Headway Technology –is a diversified enterprise producing industrial, passenger, truck, and bus tyres. But financially-troubled Hengyu Technology lists US$190 million in unaudited market value, while stockholders’ equity was pegged at negative $107 million, as of mid-2018.

Hengyu Technology currently has an annual capacity of 650,000 truck/bus tyre units and 6 million passenger tyre units,and further undisclosed capacities for engineering and military tyres. Under bankruptcy restructuring, the capacities at the Dongying plant could be raised to 800,000 and 10 million units respectively, when a facility upgrade is completed, according to buyer Doublestar.

Doublestar is China’s largest tyre company, and is the controlling shareholder of South Korea’s Kumho Tire Co. Inc. -Doublestar is considered the world’s 27th largest tyre production company, based on fiscal sales of US$1.04 billion in 2017. The investment into Hengyu Technology will go through Doublestar’s Jilin Jixing Tire subsidiary.

Doublestar’s Qingdao site factory is rated at 4 million truck/bus and 6 million passenger tyres in annual capacities, while a second site in Shiyan, Hubei Province will have annual capacity for 1.5 million truck/bus and 5 million passenger tyres once a relocation project from June 2018 is completed.


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