Wiring Systems And Automotive Cable Solutions Leonis Restructuring on Track: Company Goes into Chinese Hands

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Leoni has reached the next step in its restructuring: The Chinese company Luxshare-ICT has acquired the majority stake in the Wiring Systems Division from the previous owner Stefan Pierer, and a Luxshare subsidiary has acquired 100 percent of the Automotive Cable Solutions business from Leoni AG.

Leoni has been hit hard in recent years, especially by the Corona crisis and the subsequent Ukraine war. After a capital reduction, the company was delisted and underwent a comprehensive restructuring plan.

The company now reports that a significant milestone has been reached on the path of sustainable recovery, consistently driven under CEO Klaus Rinnerberger and Stefan Pierer as the previous sole owner: The extensive partnership agreed upon in 2024 between the two Leoni shareholders, Luxshare-ICT and Stefan Pierer, has been finalized. This is a crucial step to ensure long-term stability and future growth, according to Leoni.

After signing a binding agreement in September 2024 and obtaining the necessary regulatory approvals, the Chinese company Luxshare-ICT has now acquired 50.1 percent of the shares in Leoni AG, including its Wiring Systems Division (WSD), from the previous sole owner Stefan Pierer. At the same time, Luxshare's subsidiary TIME Interconnect has taken over 100 percent of the Automotive Cable Solutions (ACS) division from Leoni AG.

Global Market Access Improved

The extensive partnership is intended to significantly strengthen Leoni's competitiveness. By combining Leoni's longstanding relationships with globally leading automotive and commercial vehicle manufacturers with Luxshare's connections to customers such as Tesla and major Chinese automakers, the two companies aim to expand their market potential. Chinese manufacturers are increasingly expanding into the European and American markets, with Leoni AG positioned as a reliable partner for wiring systems to support these new players and thereby solidify its own market position.

At the same time, the acquisition of Leoni's ACS division, which operates as an independent supplier of automotive cables, provides TIME Interconnect with significant market access across Europe. Conversely, ACS can strengthen its presence and proximity to key customers in the dynamic Asian market.

Vertical Integration: Complementary Product Offering

The products and solutions of Leoni and Luxshare complement each other and create significant synergies in their portfolios, the companies state. With Luxshare's electronic components, Leoni can increase the value-added depth in its own wiring system production through joint development. This promises not only greater flexibility but also more speed and lower costs. Together, both companies will offer comprehensive end-to-end solutions covering the entire value chain of electronic-electrical architecture—from the development and production of wiring harnesses to electronics and software.

Global Manufacturing Network: More Flexibility And Automation

There is also complementarity in production: Leoni has already made good progress in "Design for Automation" as well as automated final assembly. With Luxshare's complementary automation expertise, joint process innovations are to be advanced and operational efficiency increased. Additionally, linking the global production networks of Leoni and Luxshare is expected to enable both companies to respond quickly and effectively to regional market dynamics and changing customer needs.

Financial Recovery: Still Fully on Track

With the partnership, Leoni also succeeds in achieving financial stability alongside the operational recovery that CEO Klaus Rinnerberger has been consistently driving since taking office in summer 2023. The restructuring program remains fully on track, according to Leoni—this despite the current uncertainties in the global automotive market.

This allows the Nuremberg-based (Germany) company to reduce overhead costs by 20 percent across all areas. Additionally, the company is adjusting its capacities to volatile and regionally shifting market conditions. Furthermore, Leoni is optimizing its production costs through process improvements and efficiency enhancements across all parts of the value chain.

"Our complementary portfolios, strengths in production, and positive customer feedback show that Leoni and Luxshare are a perfect match," says Leoni CEO Klaus Rinnerberger. (kr)

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