Bilbao-based Cie Automotive reported Tuesday to the Spanish financial regulator CMNV that it had subscribed a joint venture deal with the Chinese group Donghua Automotive Industrial.
The Spanish company, through its Brazilian subsidiary Autometal, now owns 50 percent of Nanjing Forging’s share capital. Priorly to this accord, Donghua was the proprietary of 96.75 per cent of this society. The operation has an approximate value of €17 million.
Both firms, Cie Automotive and Donghua, aimed at setting a partnership to produce and develop automotive components while opening each other’s domestic markets.
Nanjing Forging reached a business volume in 2011 of €41.3 million and had earnings before interest, tax, depreciation and amortisation of €3.7 million. The joint venture expects demand to grow as access to new customers has virtually improved after the deal.
Cie Automotive invoiced €810 million or 8% less in the first quarter of 2012 due to the unstable financial situation. Despite these figures, the group claimed a net profit of €33.4 million.
“These results mainly respond to the good operating profits in all regions, including Europe, that have benefited from the flexibility of the group’s multi-technological model, which allows us to promptly adapt to the ever-changing circumstances of the environment,” said Antón Pradera, CEO of CIE Automotive.
Pradera said then that “our policy is to make the most of our excellent financial situation to grow and integrate new companies into our group.”