Nexans intends to create the JV based on Shandong Yanggu’s power cable business, and will hold 75%, while Shandong Yanggu will hold 25% of the JV.
The transaction is expected to take six to eight months to complete and is subject to various conditions precedent including the approval of the Chinese regulatory authorities.
The companies said the transaction would value the new business on a debt and cash free basis at nearly CNY1,240m ($191.7m).
Shandong Yanggu chairman Li Ming Suo said the company’s co-operation with Nexans will further reinforce its positioning in the market.
Power cables manufacturer Shandong Yanggu supplies energy infrastructure cables to the State Grid Corporation of China, power generation groups and various other industries.
The company has three manufacturing facilities producing extra and high voltage, medium voltage, and low voltage power cables.
