Foxtron shares up on acquisition of Yulon's Luxgen assets

Taipei, Dec. 22 (CNA) Shares in Foxtron Vehicle Technologies Co., a Taiwanese electric vehicle developer, moved higher Monday after the company announced over the weekend that it will acquire Luxgen Motor's assets from Yulon Motor Co., one of the leading automakers in Taiwan.

Foxtron shares closed at NT$41.00 (US$1.30), up 3.80 percent on the Taiwan Stock Exchange after the company, a joint venture between Taiwan-based manufacturing giant Hon Hai Precision Industry Co, also known as Foxconn globally, and Yulon Motor, agreed to buy Luxgen's assets for NT$787.6 million.

However, shares in Yulon moved sharply lower by 9.79 percent to end at NT$34.55 after the announcement. Analysts said investors pocketed their gains built for the stock in recent sessions as the acquisition deal was realized.

The transaction, scheduled to be completed in the first quarter of next year at the earliest, will include Luxgen's five sales dealers, sales offices and employees, to build a comprehensive EV distribution and services network in Taiwan. The deal is pending approval from the Fair Trade Commission, Foxtron said.

Luxgen, a combination of "Luxury" and "Genius" concepts, was created in 2009 by Yulon as the automaker's late Chairman Kenneth Yen (嚴凱泰) had an ambition to roll out cars under its own brand. After the sale deal with Foxtron, Yulon Motor will retain the Luxgen brand.

Luxgen, used to produce n7 sport utility vehicles based on the Model C EV prototype, unveiled by Hon Hai, which has intensified efforts in EV development by diversifying its product portfolio. The n7 model entered commercial production in the fourth quarter of 2023, and Luxgen has delivered 10,162 n7 EVs.

In addition, Luxgen has 700-800 n7s in inventory and will continue to sell the model based on existing plans, Yulon Motor said.

After the acquisition of Luxgen's assets, Foxtron said, the company will outsource production of future models, adding it will launch EVs under the Foxtron Bria model based on Hon Hai's Model B, an urban car model.

The Model B under the Foxtron Bria brand will first go on sale in Taiwan before shipping overseas next year, Foxtron said.

After the transaction, Foxtron said, it will continue to push for a contract design and manufacturing service (CDMS) model under Hon Hai by leveraging Luxgen's existing sales and services network to target overseas markets.