GRAMMER AG - Capital/Financing Update 2017

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Corporate | 14 February 2017 08:10

Grammer AG and Ningbo Jifeng Auto Parts plan strategic partnership

DGAP-News: Grammer AG / Key word(s): Corporate Action

14.02.2017 / 08:10

The issuer is solely responsible for the content of this announcement.

Grammer AG and Ningbo Jifeng Auto Parts plan strategic partnership

Strategic partnership between Ningbo Jifeng and Grammer to improve future joint competitive position in particular in the Chinese automotive market

A Ningbo Jifeng associated company subscribes to a EUR 60 million mandatory convertible bond representing approximately 9.2% of the current share capital of Grammer AG under the exclusion of subscription rights

Amberg, February 14, 2017 – The two automotive components suppliers Grammer AG and Ningbo Jifeng Auto Parts Co. have today announced their joint intention to form a strategic partnership. The strategic partnership will improve the joint competitive position of the two internationally active automotive interior specialists, securing future growth and enhancing the value of both companies.

Strategic partnership for joint expansion of Chinese business

The planned collaboration will allow both companies to expand their presence in the important and attractive Chinese market and enhance their product offerings to existing customers. The product offerings of Grammer and Ningbo Jifeng are very complementary, addressing the high, medium as well as low price segments.

The partnership will also improve both companies’ access to local and international OEMs. Grammer will be able to access local automotive OEMs in China as well as alternative distribution channels and benefit from improved purchasing conditions. Ningbo Jifeng will be able to tap into the global resources, access and know-how of Grammer through the partnership.

As the largest and most rapidly growing automotive market worldwide, China offers great potential for Grammer. Currently, the Chinese market accounts for approximately 15% of Grammer’s global automotive revenues.

Ningbo Jifeng and Grammer will continue to explore the possibility of joint projects as well as joint ventures in the Chinese and potentially other markets.

Automotive OEMs welcome joint partnership

Leading automotive OEMs and principal customers explicitly welcome the planned strategic partnership between Grammer and Ningbo Jifeng. Both companies are long-standing and reliable partners to the automotive industry. From the customer point of view, the participation of Ningbo Jifeng helps to enlarge the shareholder base of Grammer AG.

Ningbo Jifeng’s associated company subscribes to a mandatory convertible bond, which will enlarge the shareholder base of Grammer AG

As part of the partnership, an associated company of Ningbo Jifeng has subscribed to a mandatory convertible bond representing approximately 9.2% of the share capital of Grammer, issued under the exclusion of subscription rights. The convertible bond will be converted into approximately 1,1 million voting shares of Grammer AG at the latest one year after issuance, if the bondholder has not exercised its conversion right before. The total proceeds to Grammer from the issuance will be EUR 60 million. Upon conversion, Ningbo Jifeng through its associate will become a significant shareholder of Grammer AG, reinforcing the companies’ joint strategic partnership.

“We have been operating our own plants in China for many years and want to substantially expand our presence in the world’s largest market for commercial and passenger vehicles. There is significant growth potential in China and we are very pleased to have Ningbo Jifeng as a strong partner for our automotive business in China. The future strategic partnership will open up additional possibilities for us to reach and supply additional local Chinese customers with our innovative products,” says Hartmut Müller, CEO of Grammer. “At the same time, an associated company of Ningbo Jifeng will become a new shareholder enlarging Grammer’s shareholder base in the interests of all shareholders, customers and employees,” Hartmut Müller added.

“Grammer enjoys an outstanding international reputation as a leading, innovative supplier. As a result, we are very proud to enter into the envisaged joint partnership. Our group’s investment in Grammer solidifies our strategic partnership and we are in full support of the successful course which Grammer’s management team has been pursuing over recent years,” said Yiping Wang, CEO and Chairman of Ningbo Jifeng Auto Parts.

Business Description of Ningbo Jifeng Auto Parts Co. and Grammer AG

Ningbo Jifeng Auto Parts Co. is an international automotive component supplier, specializing in interior parts, and one of the leading producers of headrests and armrests in China with around 2,600 employees in locations in China, Europe and Canada. Its customers include leading tier-1 system producers as well as local and international automotive OEMs. Incorporated in 1996 in Ningbo, China, Ningbo Jifeng Auto Parts Co. has been listed on the Shanghai stock exchange since 2015 and currently has a market capitalization exceeding EUR 1 billion.

Grammer AG is a global components supplier serving the automotive and commercial vehicles industry and specializes in the development and production of components for automotive interiors as well as seat systems for offroad vehicles, trucks, buses and railway. With over 12,000 employees, the Grammer Group operates roughly 40 facilities globally, in which it produces headrests, armrests and center consoles for the automotive market as well as suspended driver and passenger seats for commercial vehicles. The Grammer Group realized revenue of around EUR 1.7 billion in 2016. Grammer has been listed on the stock exchange since 1996 and currently has a market capitalization of around EUR 650 million.

Globally, Grammer currently generates revenues of EUR 1.2 billion in the Automotive-segment. China, the largest automotive market globally, contributes 15% to overall automotive revenues.

About Ningbo Jifeng Auto Parts Co., Ltd.

Incorporated in 1996, Ningbo Jifeng Auto Parts Co., Ltd. is domiciled in the Eastern Chinese coastal city of Ningbo. In the automotive segment it specializes in the production and assembly of headrests as well as seat and door armrests predominantly for passenger vehicles. Its customers include international premium automotive OEMs.

Ningbo Jifeng has around 2,600 employees at a total of eight production sites in China, Europe and Canada. In 2015, it achieved revenue of a total of around EUR 140 million. China accounts for 87 percent of its business and the United States, Europe and Japan for 13 percent.

Ningbo Jifeng is listed on the Shanghai stock exchange under ISIN CNE100001V94.

About Grammer AG

Located in Amberg, Germany, Grammer AG specializes in the development and production of components and systems for automotive interiors as well as suspended driver and passenger seats for onroad and offroad vehicles. In the Automotive Division, Grammer supplies headrests, armrests, center console systems and high-quality interior components and operating systems to premium automakers and automotive system suppliers. The Seating Systems Division comprises seats for the truck and offroad seat segments (tractors, construction machinery, forklifts) as well as train and bus seats.

With over 12,000 employees in 32 fully consolidated companies Grammer operates in 20 countries around the world. The Grammer Group realized revenue of circa EUR 1.7 billion in 2016.

Grammer shares (ISIN DE0005895403) are listed in the SDAX and traded on the Frankfurt and Munich stock exchanges via the electronic trading system Xetra.

Contact:

GRAMMER AG

Ralf Hoppe

Phone: 0049 9621 66 2200

[email protected]

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Language:	English
Company:	Grammer AG
	Georg-Grammer-Str. 2
	92224 Amberg
	Germany
Phone:	+49 (0)9621 66-0
Fax:	+49 (0)9621 66-1000
E-mail:	[email protected]
Internet:	www.grammer.com
ISIN:	DE0005895403, DE0005895403
WKN:	589540, 589540
Indices:	SDAX
Listed:	Regulated Market in Frankfurt (Prime Standard), Munich; Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Stuttgart, Tradegate Exchange