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To talk about Schaeffler's acquisition, we should first know some background information of LYC Group.
Dec. 2004, LYC Group who was at the edge of bankruptcy, together with Yongcheng Coal & Electricity Group Co.,Ltd(YCEG) invested RMB400 million, forming the Luoyang LYC Bearing Co.,Ltd(LYC Bearing). Since then, LYC Group began to recover from the previous financial crisis.
Although, LYC Bearing had a record high of sales in the first year since their founding, it doesn't last long until other problems come out. From the above LYC and YCGE cooperation, we can see that after the cooperation, LYC Group were divided into two parts: the one that divested from LYC Group and formed LYC Bearing with YCEG and the weakened previous LYC Group.
The outcome led to a embarrased fact that when it comes to LYC, people are not clear which one it exactly refers to. Furthermore, this is also not what the enterprise favoured. Then, a LYC integration was in the air.
It is ideal that YCEG would have acquired the LYC Group, then LYC will resume to be integrated. But, no one, including YCEG, would like to acquire a partner who still owe a debt exceeding RMB2 billion, unless they have some specified purposes.
At this moment, Schaeffler Group sent their delegates to LYC, showing an interest in acquiring the endangered enterprise. However, the acquiring terms proposed by Schaeffler Group seemed very irrational. One of the terms indicated that Schaeffler Group would like to buy the LYC brand with RMB100 million( It is obvious that such a famous brand in China will be much more worthy than RMB100 million) then desert the former LYC Group's site in Luoyang, Henan province and have a new site in Luonan, Shaanxi province, hundreds of kilometers away.
If LYC agreed to be acquired by Schaeffler Group, they might walk out from the debt crisis. Meanwhile, LYC, the former China famous brand, might have German nationality.
As a result of the "cooperation" with Xibei Bearing, Schaeffler's FAG have held 30 percent of Chinese railway bearings' market share. Successful acquisition of LYC will make Schaeffler a dominant railway bearing producer in China. (LYC have had 25 percent of the domestic railway bearing market share) Based on the fact, LYC's acquisition case with Schaeffler Group will win few support in China.
At present, the LYC Group only revealed that before the formal signing of contract, everything is possible. It is reported that LYC Group's acquisition with Schaeffler Group will not become clear until Sept. 30 this year.
| Product Model | Inside Diameter | Outside Diameter | Thickness |
| H3326 bearing | 130 | ||
| H24126 bearing | 130 |