China Kunda Technology’s unit Kunda Mould (Shenzhen) has signed an MOU with SXD today to acquire a controlling stake in SXD’s business.

China Kunda is a provider of precision moulds, plastic injection parts and IMD products to the electronics, electrical, automobile and specialised devices industries.

SXD is a China-incorporated supplier of metal components to the automobile and electronics division of BYD Company (HKEx: 1211) which runs an IT parts business as well as handset components and assembly service, and automobile business.

In Sept 2008, Warren Buffet’s Berkshire Hathaway invested US$230 million ($332 million) to acquire a 10% stake in BYD.

Under the terms of the non-binding MOU, Kunda Mould (Shenzhen) has the right to acquire at least 51% of the paid-up capital of SXD.

But the actual acquisition, as well as the extent of equity in SXD to be acquired, and the consideration payable, will be subject to the entry into of definitive agreements and due diligence to be carried out by Kunda Mould (Shenzhen).

However, Kunda Mould (Shenzhen) also has the unilateral right to terminate the MOU without any compensation to SXD.

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