Company Overview - The company announced on December 18 that its indirect wholly-owned subsidiary, Minhua American Manufacturing, will acquire 100% of Gainline Recline Intermediate Corp. for $32 million by December 18, 2025. The company will also assume $27.9939 million in outstanding bank debt from the target group, with a total transaction value of approximately $58.7 million [1][2]. Target Group Details - The target group primarily engages in the manufacturing and sales of upholstered furniture in the United States, owning two major brands: Southern Motion (established in 1996, specializing in functional sofas) and Fusion Furniture (established in 2009, focusing on stationary furniture). The target group operates eight production facilities in northern Mississippi, covering over 2 million square feet. For the fiscal year ending June 28, 2025, the target group's revenue was $18.8 million, with a net loss of $9.6867 million [1][2]. Strategic Benefits - The acquisition is expected to generate significant synergies for the company. The target group has a distribution network covering over 1,000 furniture retailers and two established brands, which is anticipated to rapidly enhance the company's market share in North America. The company has advantages in raw material procurement costs and automation levels, allowing for deep supply chain collaboration with the target group. Additionally, the acquisition expands the company's production footprint directly into the U.S., aiding in navigating challenges and opportunities arising from changes in the international trade environment [2]. Market Positioning - The acquisition is viewed as a means to strengthen the company's local competitiveness in the U.S. market. By establishing a complete manufacturing and supply chain system in the U.S., the company aims to improve market responsiveness and customer service capabilities, effectively mitigating trade barriers and logistics risks. This move also provides a strategic foothold for integrating upstream and downstream resources and enhancing brand influence in North America [2]. Financial Forecast and Valuation - The company maintains its earnings forecasts for FY2026 and FY2027 at HKD 21.24 billion and HKD 22.48 billion, respectively. The current stock price corresponds to a P/E ratio of 8 times for FY2026 and FY2027. The company continues to rate as outperforming the industry with a target price of HKD 6.5, which corresponds to a P/E ratio of 12 times for FY2026 and 11 times for FY2027, indicating a potential upside of 47.7% from the current stock price [2].
敏华控股(01999.HK)：收购美国家具商 长期构建北美供应链护城河