Apple Connection Gives Chinese Electronics Supplier a Stock Boost
In a sign of how much weight the Apple (NASDAQ:AAPL) name carries in the worldwide tech industry, a minor China-based electronics supplier has seen its stock rise dramatically after news broke that an Apple supplier was acquiring a 29.9 percent stake in the company, reports Forbes. AKM Industrial has seen its stock jump over 27 percent in the last two trading sessions after Apple acoustic component supplier GoerTek announced that it will buy 290.9 million shares of the company. AKM Industrial’s shares closed up $0.16 at $0.75 on Friday.
According to its official website, “GoerTek is a worldwide leading acoustic component and audio consumer electronic product designer and manufacturer. It provides total audio solutions to leading companies in communication and mobile industries, serving tier one customers with innovation, cost competition and time-to-market.”
GoerTek will reap an immediate benefit from its investment in AKM Industrial, since it will purchase shares at about $0.06 each. However, Forbes noted that GoerTek’s investment in the company is still subject to shareholder approval. About 65 percent of AKM Industrial is owned by North Industries, a Chinese government-run conglomerate also known as Norinco.
Besides Apple, GoerTek’s customers include Samsung (SSNLF.PK), LG, Panasonic (PCRFY.PK), Nokia (NYSE:NOK), Microsoft (NASDAQ:MSFT), Foxconn, and several other major tech companies. Apple’s 2013 supplier list names two GoerTek facilities based in China’s Shandong province that produce components for Apple.
As noted by Forbes, GoerTek’s chairman is Chinese billionaire Jiang Bin. Bin is estimated to be worth $4.8 billion and is ranked No. 15 on the 2013 Forbes China Rich List.
On the other hand, AKM Industrial is a relatively small company with a market capitalization of just $412.43 million. According to its official website, AKM Industrial “is a leading FPC [flexible printed circuits] substrate company offering FPC/COF [chip-on-film] design, manufacturing, SMT [surface-mount technology] assembly services and full module turnkey services.” Flexible printed circuits are widely used in various types of mobile products, including Apple’s iPhones.
Here’s how Apple closed out Friday’s shortened trading session.
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