(Yicai) Oct. 27 -- Meili High Technology said the Chinese car springs and precision mold parts supplier will invest EUR63.7 million (USD74.1 million) to acquire Netherlands' Hitched Holdings 3, which owns a leading German trailer hook supplier and relevant factories and dealers worldwide.

Hitched's ACPS Group owns ORIS, a well-known brand with high customer loyalty in the auto trailer hooks market, Meili High announced late on Oct. 24. The target firm owns factories in Germany, Hungary, Mexico, and China and counts Volkswagen Group, Mercedes-Benz, BMW, and Tesla among its long-term carmaking clients, it said.

A trailer hook is a connecting device installed on the front or rear bumper or chassis of a vehicle used for towing or recovery. They are mainly made using high-strength steel because the material can withstand the huge tensile force during towing.

Meili High will acquire ACPS' mature sales channels in the European and US markets, core technologies, and the ORIS brand to achieve synergetic development with its existing auto parts business, the Shaoxing-based company noted.

In addition, Meili High will promote a business model of making car parts in China and assembling them overseas after completing the deal, it said, adding that it will use its existing plants and supply chains to help ACPS's factories cut core raw material processing costs and effectively respond to international trade barriers and supply chain disruption risks.

Meili High will rely on ACPS to form long-term alliances with big international clients to greatly shorten the cycle and reduce the cost of expanding into overseas markets, it pointed out.

Shares of Meili High Tech [SHE: 300611] dropped 3.6 percent to CNY33.93 (USD4.76) apiece as of 2 p.m. in Shenzhen today, after surging by as much as 5.5 percent in the morning trading session.

Editor: Martin Kadiev