Shanghai-based conglomerate Fosun Group, together with the Nanjing Nangang Iron and Steel United, announced a joint acquisition of a major stake in a German lightweight automotive company, Koller Beteiligungs GmbH, on Thursday.
The announcement marks the first overseas investment for Nanjing Nangang, as well as Fosun's first overseas investment in the automotive industry.
However, the exact proportion of stake, which the two Chinese companies hold in Koller, was not disclosed.
In 2014, Hannover Finanz GmbH acquired 75 percent of Koller, and the founders of Koller have since remained in senior executive positions.
With plants in Germany, Hungary and Mexico, Koller produces injection moulding composite parts, as well as pressing tools for automotive manufacturers who are looking to cut energy consumption and pollution emission by reducing the weight of the car. Leading automotive manufacturers, such as Volkswagen, Audi, BMW, Mercedes Benz and Land Rover, are all Koller clients.
Max Koller, chief executive of Koller and co-founder of the company with his brother Thomas Koller, said the partnership will enable the organisation to expand their business into the Asian market.
"With support from its new major shareholder, Koller will also strengthen its positioning in Europe and explore new production locations in China," he said.
Guo Guangchang, chairman of Fosun, said environmental protection and energy saving techniques are key global initiatives, especially in China.
"Lightweight technology could effectively decrease the energy consumption and promote sustainable development," he said.
"I believe there will be greater demand for high quality, and innovative lightweight products and solutions."
The three subsidiaries of Fosun set up the joint venture – Nanjing Nangang with the Nanjing Iron and Steel Group in 2003 – which helped with the latter's mixed ownership reform. In the joint venture, the Nanjing Iron and Steel Group controls 40 percent of the project, while Fosun's three subsidiaries hold 30 percent, 20 percent and 10 percent respectively.
Huang Yixing, chairman of Nanjing Nangang, said new material was one of the company's focuses for business transformation, which he hoped would grow into a core business in the future.
"Koller's expertise in providing lightweight solutions is in line with the company's transformation direction," he said.