Leoni AG has two core businesses: Automotive Cable Solutions Division (ACS business) and Wiring System Division (WSD business). Among them, the main operating entity of the ACS business is Leoni K, and the main operating entity of the WSD business is another wholly-owned subsidiary of Leoni AG, Leoni Bordnetze Systeme (Leoni B). Prior to this transaction, Leoni B had four wholly-owned subsidiaries operating in the ACS business: Leonische Holding, Inc., Leoni Cable, Inc., Leoni Cable S.A. de C.V., and Leoni Cable de Chihuahua S.A. To ensure the smooth progress of this transaction, L2-Beteiligungs GmbH, the sole shareholder of Leoni AG, will facilitate the asset restructuring of the aforementioned four companies according to business sectors before the closing date of the equity transfer.

After the approval of the board of directors, the company will sign the Share Purchase Agreements (SPA ACS and SPA WSD) related to the ACS business and WSD business respectively with L2-Beteiligungs, Leoni AG and other transaction-related parties. The transaction structure specified in the SPA agreements is as follows:

ACS business related transaction: Luxshare Precision Limited, a wholly-owned subsidiary of the company, and Time Interconnect Technology Limited, a subsidiary of the company, jointly establish Time Interconnect Singapore Pte. Ltd., with a registered capital of 0.4 million USD. Luxshare Precision Limited holds 51% equity of Time Interconnect Singapore, while Time Interconnect Technology Limited holds 49% equity. Subsequently, Time Interconnect Singapore will acquire 100% equity of Leoni K held by Leoni AG for a transaction price of 320 million euros. If the net asset value of Leoni K specified in the delivery statement provided by Leoni AG is lower than the transaction price within 60 days after the delivery date or on the 60th day, the purchase price shall be adjusted downward, and the difference shall be refunded to the bank account of Time Interconnect Singapore. After the completion of the above transaction, Leoni AG will continue to hold 100% equity of all the main operating entities related to the WSD business, including Leoni B.

WSD business related transaction: Luxshare Precision Singapore Pte. Ltd., a wholly-owned subsidiary of the company, will acquire 50.1% equity of Leoni AG held by L2-Beteiligungs for a transaction price of 205.41 million euros, corresponding to 25.05 million shares. The remaining 49.9% equity of Leoni AG will continue to be held by L2-Beteiligungs.

According to the announcement, as a leading global supplier of cables, wires, and wiring system solutions, Leoni AG has more than 100 years of development history. Its main products include standardized cables, special cables, and custom-developed wiring systems and related components, which are widely used in industries such as automotive manufacturing, communication, and medical devices. Through this acquisition, on the one hand, it will facilitate the exchange of resources, complementary advantages, and strategic synergy between the company and Leoni AG in terms of product development, market expansion, customer access, capacity layout, and material procurement. It will also quickly establish the company's differentiated competitive advantage in the global automotive wiring field, and provide more convenient and efficient vertical integrated services for Chinese car companies going abroad and overseas traditional car companies.

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On the other hand, based on the valuable experience gained from analyzing and summarizing each internal and external growth, combined with the ability advantages accumulated over the years such as process optimization, vertical integration, and factory operation, the company will provide optimization and empowerment in areas including but not limited to finance, business, procurement, production, personnel structure, internal control, and business expansion for Lenny Company and Leoni K after completing the equity delivery, to help them achieve better business performance in the future.