Transsion plans a reverse takeover via Shenzhen shell company
Chinese owner of Tecno phones plans to list in China via shell
A Chinese company that dominates the African smartphone market is preparing for a backdoor listing that will make it one of the Asian country’s biggest publicly traded mobile device makers.
Shenzhen Transsion Holdings Co., which accounts for nearly 30 percent of the African smartphone market, plans to transfer a controlling stake to Shenzhen-listed Shimge Pump Industry Group Co. via an asset and share-swap deal, according to a stock exchange filing on Thursday. The deal remains in negotiations but the closely held company — which sells phones under the Tecno brand among others — ultimately aims to gain Shimge’s stock listing, Transsion spokeswoman Li Huijun said.
Led by founder Zhu Zhaojiang, Transsion shipped nearly 12 million smartphones to Africa in the first three quarters of last year, helping it leapfrog Samsung Electronics Co. and Apple Inc. to become the largest player on the continent, according to researcher Canalys. The Chinese company has become the biggest seller in countries from Kenya and Nigeria to Senegal.
Few of China’s biggest smartphone vendors, from Huawei Technologies Co. to Xiaomi Corp., are publicly traded. Li said Transsion is still exploring options with Shimge Pump and no financial details have been finalized. Shimge Pump shares have been halted pending further announcements.
“One of the biggest reasons for their success was their distribution strategy where they managed to attract leading local resellers through the affordable offerings,” said Tarun Pathak, an analyst with Counterpoint Research.