BEIJING, Dec. 20, 2010 /PRNewswire-Asia-FirstCall/ -- On December 20th, 2010, Wonder Auto Technology, Inc. (Nasdaq: WATG) ("Wonder Auto" or the "Company"), a leading manufacturer of automotive electrical parts, automotive safety products, suspension products and engine accessories in China, announced that it has launched a project to list (the "Listing") its subsidiary Jinzhou Halla Electrical Equipment Co., Ltd. ("Jinzhou Halla") on China's Shenzhen Stock Exchange ("SZSE"). As part of the Listing, the Company anticipates that Jinzhou Halla will conduct an initial public offering of its new shares on SZSE, and WATG's shareholders will still hold more than 73% of shares of Jinzhou Halla after the IPO. The purpose of the Listing is to maximize the Company's capital value by taking advantage of attractive valuations on the SZSE and to raise additional capital that can be used to grow the business.
In advance of the Listing, WATG intends to reorganize several of its subsidiaries to consolidate in Jinzhou Hall its automotive engine parts business, including its starter and alternator business and engine valve and tappets business. These businesses are expected to account for 50% to 60% of the Company's projected net income in 2010.
"Since listing on Nasdaq, Wonder Auto has experienced rapid growth with the support from its investors. The Company and management team appreciate the investors' great support and acceptance. We believe that China's economy and automotive industry will continue to experience growth in the next few years, which provides WATG, as a leading supplier of China automotive parts, with great opportunities. We believe that we will be able to achieve better business performance if the Company gets additional capital support. According to our investigation, the SZSE has been providing attractive valuations to companies. For instance, the current PE ratio range of past IPOs in SZSE in 2010 was between approx 40-140 times. Accordingly, we believe that listing a portion of Jinzhou Halla will provide the Company the capital that it needs to leverage its opportunities for growth and also increase value for WATG's existing shareholders," said Mr. Qingjie Zhao, the Chairman and CEO of Wonder Auto, in discussing the proposed listing of Jinzhou Halla on the SZSE.
The Company cautions investors that listing on the SZSE is a complex process that involves a number of risks and uncertainties, including without limitation, approval of China's Securities Regulatory Commission, and there is no assurance that the listing of Jinzhou Halla on the SZSE will be completed.
The Company will hold a conference call at 8 am Eastern Time on Jan 3rd 2011 to discuss the proposed listing of Jinzhou Halla on the SZSE, including the expected schedule, returns, risks and related matters. To participate, please call the following numbers 10 minutes before the call start time:
Local Dial-In Number(s)
International Toll Free Dial-in Number(s):
China, China Telecom
China, NetCom Users
Conference ID: 33496485
About Wonder Auto
Wonder Auto Technology, Inc. is a Nevada holding company with operating subsidiaries in China primarily engaged in the business of designing, developing, manufacturing and selling automotive electric parts, automotive safety products, suspension products and engine components. Our products include alternators and starters, airbags, pretensioners and steering wheels, engine valves and tappets, and rods and shafts for use in shock absorber systems. We have been manufacturing alternators and starters in China since 1997, and according to the China Association of Automobile Manufacturers, in 2009 we ranked second and fourth in sales revenue in the Chinese market for automobile alternators and starters, respectively. Our subsidiary Jinzhou Jinheng has been designing and developing airbags for over 10 years. We believe that we were the largest Chinese brand airbag manufacturer in terms of sales volume in 2009 and the biggest Chinese pretensioner manufacturer. Our subsidiary Jinan Worldwide has been producing engine valves and tappets for over 50 years. We believe we are now one of the largest manufacturers of engine valves and tappets in China in terms of sales volume. Our subsidiary Jinzhou Wanyou is supplying rods and shafts to suspension system manufacturers worldwide. We believe that we are one of the largest independent suppliers of rods and shafts for suspension system manufacturers in the world in terms of sales volume.
Our products are used in a wide range of passenger and commercial automobiles, and we are especially focused on the fast-growing small- to-medium sized engine passenger vehicle market. We sell our products primarily within China to well-known domestic and international automobile original equipment manufacturers, or OEMs, engine manufacturers and automotive parts suppliers. We are increasingly exporting our products to international markets.
Safe Harbor Statement
This press release includes certain statements that are not descriptions of historical facts, but are forward-looking statements. Such statements include, among others, those concerning the proposed listing of Jinzhou Halla on the SZSE, expected proceeds from the listing of Jinzhou Halla on the SZSE and that such proceeds will be sufficient to fund the Company's additional growth, the proposed restructuring of various of the Company's subsidiaries, the proposed sale of a 1% to 1.5% interest in Jinzhou Halla to an entity controlled by certain members of the Company's management, the expected growth in China's economy and the automotive industry and the opportunities that such growth provides the Company and expected returns to the Company's shareholders. Forward-looking statements can be identified by the use of forward-looking terminology such as "will," "believe," "expect," "may," "hope," "should," "potential," "continue," "anticipate," "future," "intend," "plan," "believe," "is/are likely to," "estimate" or similar expressions. Such information is based upon assumptions and expectations of our management that were reasonable when made but may prove to be incorrect. All of such assumptions and expectations are inherently subject to uncertainties and contingencies beyond our control and based upon premises with respect to future business decisions, which are subject to change. We do not undertake to update the forward-looking statements contained in this press release. For a description of the risks and uncertainties that may cause actual results to differ from the forward-looking statements contained in this press release, see our most recent Quarterly Reports on 10-Q and Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC"), and our subsequent SEC filings. Copies of filings made with the SEC are available through the SEC's electronic data gathering analysis retrieval system at http://www.sec.gov. All information provided in this press release and in the attachments is as of the date of this press release.
For more information, please contact:
Director of Investor Relations
SOURCE Wonder Auto Technology, Inc.