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GE energy is building a global strategic alliance with China west power

GE energy group, digital energy business will be a device with Chinese electric power transmission and distribution industry leading enterprises China xd electric co., LTD. (hereinafter referred to as "China xd"), a new global strategy alliance. The partnership will enrich GE's energy product line, making it more competitive to offer a wide range of solutions to power distribution products and power grid automation to global customers.

The tie-up includes a 3.38 billion yuan capital injection from GE to acquire a 15% stake in xi 'an, a Chinese company based in xi 'an. This means that GE in China so far one of the largest investment in the single, is also a GE a strategic partnership with China's leading enterprises, joint development of the whole business strategy and a milestone.

The cooperation consists of three main parts:

• establish a global partnership. To combine GE's power grid automation and service capabilities with China's all-around high voltage power transmission and distribution equipment/products to provide customers with a complete set of integrated transmission and distribution solutions;

• set up a joint venture company (AJV) in China to provide localized power grid automation solutions for Chinese customers.

• GE buys 15% of China's xd and has a board seat on xxii.

The global transmission and distribution business is a huge industry with a capacity of more than $100 billion, and the growth momentum is strong. The Chinese market is expected to account for a quarter of the sector's development and will lead the development of the latest technologies for high voltage and high voltage transmission and distribution. With China's efforts to upgrade its electricity grid and its huge demand for electricity, these are huge opportunities for GE China.

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On May 7, China's xidian announced that it would build a global strategic alliance with GE, the world's largest diversified conglomerate. China west electricity is one of the equipment leading enterprises in China's power transmission and distribution industry.

China xd introducing non-public stock way GE as its strategic partner, and on the basis of equity investment, in the primary and secondary equipment as well as global market sales and so on a series of strategic cooperation with them.

Ge will take a 15 per cent stake in China western electricity in cash, with a deal worth about 3.38 billion yuan. The company hopes to use GE's global sales network to achieve strategic breakthroughs in overseas sales.

The fund raised by the non-public issue A shares will be used for the establishment and follow-up of the joint venture company, and will supplement the liquidity of the company. Of these, 744 million yuan will be used for joint ventures with ge. 1.5 billion yuan to expand overseas markets; 11.39 billion yuan is used to supplement the operational capital needed for the growth of the business.

On May 7, GE Smallworld (Singapore) Pte Ltd, a wholly-owned subsidiary of GE, signed a joint venture contract in xi 'an.

The contract for the China xd electric co., Ltd., and GE Smallworld (Singapore) Pte Ltd on setting up xd GE digital energy co., Ltd. The joint venture contract, the two sides agreed to jointly established a joint venture company automation.

According to the joint venture contract, the total amount of investment proposed by the automated joint venture company is 1.26 billion yuan, with registered capital of RMB 630 million. Among them, China western electric proposed a contribution of 371.7 million yuan, accounting for 59%, and ge Singapore's proposed contribution of 258.3 million yuan, or 41 percent. The term of automatic joint venture company is 30 years, and the main business premises and research and development center are in xi 'an.

Automation of the joint venture business mainly includes the secondary equipment products (including software) to research, development, design, manufacture, assembly, engineering, engineering design, testing, sales and marketing, and provide services.

As a condition of mutual agreement to form an automated joint venture, ge will transfer the technology of secondary equipment to the automated joint venture company. The automation joint venture has drawn up and signed the relevant technology transfer agreement with ge subsidiaries.

Ge subsidiary will be in accordance with the terms and conditions of the technology transfer agreement to the automation of the joint venture company transfer of technology related to the secondary equipment, automation for the joint venture company within the scope in production, research and development, sales and distribution of secondary equipment products; Subject to the agreement of the technology transfer agreement, the relevant technology is transferred to a permanent and irrevocable license.

Within the scope of the automation of the joint venture business, automation is a joint venture company to obtain the exclusive right to the use of related technologies, will be China xd and ge in China the only two equipment products production platform.

For the past three years, the overseas revenue of China's western electric power has been 825 million yuan, 11.11 billion yuan and 13.47 billion yuan, accounting for only 5.89 percent, 8.62 percent and 12.10 percent, respectively.

The company has been so aggressive in bringing in strategic investors such as general electric to expand its presence in overseas markets with the help of its global sales network.

Ya-lin zhang said China xd's chairman, complementary advantages of both sides in the global market channel is conducive to xd to implement internationalization strategy, a sharp rise in the equipments in the overseas market sales at a time.