Jea Limited Enters into Two Equity Joint Venture Agreements with Shanghai Mechanical & Electrical Industry Co., Ltd

Published: 2025-07-16 09:06:36 ET 600835.SS

Published on 07/16/2025 at 09:06

The board of directors of Johnson Electric Holdings Limited announced that on 16 July 2025, JEA Limited, a wholly-owned subsidiary of the Company entered into two equity joint venture agreements with Shanghai Mechanical & Electrical Industry Co. Ltd. in relation to the formation of two equity joint ventures. The first joint venture will be incorporated in Shanghai (the "Shanghai JV"), and will primarily serve as a sales channel for products manufactured by the second joint venture, as well as support business development, research and development, application engineering, and customer service for humanoid robotic solutions in the People's Republic of China (''PRC'').

JEA Limited will hold a 49% equity interest in the Shanghai JV, while SMEIC will hold the remaining 51% equity interest. The second joint venture will be incorporated in Shenzhen (the "Shenzhen JV"), and will serve as the engineering design, research and development, and manufacturing base for humanoid robot hardware modules and hardware system integration solutions. JEA Limited will hold a 51% equity interest in the Shenzhen JV, whileSMEIC will hold the remaining 49% equity interest.

Pursuant to the terms and conditions of the JV Agreements, the registered share capital of each Joint Venture is RMB 75 million (equivalent to approximately USD 10.5 million). JEA Limited will contribute RMB 36.75 million (equivalent to approximately US$5.1 million) to the Shanghai JV and RMB38.25 million (equivalent to approximately $5.4 million) to the Shenzhen JV in cash respectively. SMEIC will contribute RMB 38.25 million (equ equivalent to approximately USD 5.4 million) to the China JV and RMB36.75 million (equ equivalent to approximately $5.1 million) to The Shenzhen JV in cash both.

The Group's total investment amount in the Joint Ventures is RMB75 million (equivalent toapproximately USD 10.5 million). The two Joint Ventures are structured to complement one another - combining sales, business development and customer application support with product design, engineering, and manufacturing expertise. Together, they will enable the end-to-end delivery of high-performance humanoid robotic core components and subsystems to customers across the PRC.

The establishment of the Joint Ventures is subject to completion of the necessary registration and approval procedures with the relevant PRC authorities. Upon the establishment, the Shenzhen JV will become a non-wholly owned subsidiary of the Company and the Shanghai JV will become an associate of the Company. The formation of the Joint Ventures is part of the Group's strategic initiative to expand into the fast-growing humanoid robotics sector.

The Joint Ventures will respectively focus on product research and development, commercialization (sales and service), and manufacturing and assembly, enabling a vertically integrated approach to address the emerging demand for advanced robotic solutions for commercial, industrial, and consumer applications. The Board considers that formation of the Joint Ventures represents a significant milestone in the Group's long-term strategy to expand its presence in the robotics sector and is in the interest of the Company and its shareholders as a whole. The terms of the JV Agreements and the transactions contemplated thereunder are based on arm's length negotiations.

The Directors consider that the JV Agreements are entered into in the ordinary and usual course of business of the Group and on normal commercial terms, and the terms of the JV Ag agreements are fair and reasonable and in the interests of the Company and its shareholders.