Core Viewpoint - The company, Jiujiang Defu Technology Co., Ltd., has made a strategic move by acquiring a 51% stake in Anhui Huiru Technology Co., Ltd. while terminating the acquisition of Circuit Foil Luxembourg due to geopolitical risks and strategic misalignment [1][2][3]. Group 1: Acquisition of Anhui Huiru - The acquisition of a 51% stake in Anhui Huiru is a significant strategic initiative aimed at strengthening the company's position in the electrolytic copper foil industry, enhancing total production capacity, and solidifying its leadership in the global copper foil market [1]. - This move is expected to leverage the scale and demonstration effects of a leading enterprise, promoting a shift in the Chinese copper foil industry towards higher concentration and competitiveness [1]. Group 2: Termination of CFL Acquisition - The termination of the acquisition of Circuit Foil Luxembourg was due to the Luxembourg Ministry of Economy's final decision, which imposed conditions that conflicted with the company's strategic control requirements [2][3]. - The company emphasized that the imposed conditions would hinder its ability to integrate CFL into its overall strategic framework, thus jeopardizing shareholder interests [3]. Group 3: Geopolitical Risk Insights - The company’s decision to terminate the acquisition reflects a prudent approach to avoid geopolitical risks, similar to the challenges faced by other Chinese tech firms in overseas acquisitions [4]. - The restrictions imposed by the Luxembourg government are akin to those experienced by Nexperia, highlighting the increasing scrutiny on foreign investments in sensitive sectors [4]. Group 4: Strategic Shift - The termination of the CFL acquisition is not a retreat from globalization but a strategic pivot towards domestic industry consolidation, which is seen as a more stable and efficient growth path [5]. - The company aims to focus on integrating domestic high-quality production capacities, particularly leveraging Anhui Huiru's advantages, to meet the growing demands of the electric vehicle and PCB industries [5]. Group 5: Future Outlook - The company plans to drive growth through a dual strategy of internal development and domestic acquisitions, emphasizing the importance of local integration and technological independence [6]. - Future international expansion will prioritize non-controlling forms of collaboration to mitigate geopolitical sensitivities, ensuring a more flexible approach to global competition [6]. - The company reassures that the termination of the CFL acquisition will not adversely affect its normal operations or financial health, as it maintains a healthy cash flow and is progressing with domestic integration projects [6].
德福科技：主动规避地缘政治风险聚焦国内高质量整合