KUALA LUMPUR (October 26): JF Technology Bhd, through its JF International Sdn Bhd unit, is partnering with Huawei Investment & Holding Co Ltd’s Hubble Technology Investment Co Ltd (HTI) to establish a manufacturing plant and supply of high performance test contactors in China.
This confirms a report of theedgemarkets.com on Friday about the partnership with Huawei.
Through the proposed business collaboration, JF Technology will strengthen its relationship with HTI as a key customer and strategic partner, as well as gain access to the market in China, according to a Bursa Malaysia filing today.
“The proposed business collaboration allows the JF Group to establish a long-term synergistic business partnership with HTI, where both parties will leverage each other’s strengths,” said JF Technology.
JF International today entered into a capital increase agreement and a shareholders’ agreement with HTI and its unit JFH Technology (Kunshan) Co Ltd for this partnership that serves to affirm its first step in strengthening its presence in China, he said.
With the opportunity for JFH Technology to work closely with HTI to develop a new test contact technology for 5G and 6G networks, as well as in the future, this will allow JFH Technology to move up the semiconductor industry value chain while develops local talent among Malaysians, he added.
Under both agreements, JF International will subscribe $ 500,000 in cash to JFH Technology for a 55% majority stake, while HTI will contribute $ 1.5 million to the remaining 45%.
HTI’s higher investment value serves as a contribution in kind to the transfer of intellectual property owned by JF Technology, the company said.
HTI is the venture capital arm of Huawei, which was formed in April 2019 and is headquartered in China. He made several strategic investments in companies involved in semiconductors, chips and AI, among others.
JF Technology said that JF International will finance the signing of the 55% stake through internally generated funds. Thus, this collaboration will have no effect on the group’s leverage position for the year ended June 30, 2021 (AF21).
The proposed collaboration should also have no material effect on the group’s consolidated earnings and earnings per share for FY21.
Except for any unforeseen circumstances, the board expects the proposed business collaboration to be completed by the first quarter of FY22.
“Through this collaboration, JF Tech will strengthen its relationship with Huawei as a strategic partner, in addition to gaining access to the market in China. This will also allow JF Tech to take advantage of China’s large-scale semiconductor location plan and capture tremendous sales and incentives, ”said JF Technology managing director Datuk Foong Wei Kuong in a separate statement today.
“In addition, we believe that we are the first manufacturer in Malaysia of high performance test contact solutions to set up a factory in China, which gives us the advantage of being the pioneer.”
“In turn, we will be able to develop our network to better serve our customers in China, reducing delivery times and increasing the efficiency of the supply chain. We identified Kunshan, in Jiangsu province, as a potential location for our first factory in China, which is also close to our main customers, ”he added.
At the same time, Foong said that JF Technology will also bring its Malaysian partners into the semiconductor ecosystem to participate in the Chinese market.
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Trading of shares of JF Technology will be suspended next Monday, pending ‘relevant announcement’