BEIJING - Hollysys Automation (NASDAQ:HOLI) Technologies Ltd. (NASDAQ: HOLI), a prominent provider of automation control system solutions in China, is on track to complete its merger with an entity controlled by Ascendent Capital Partners by July 25, 2024. The company has obtained all necessary approvals and expects to meet or waive all closing conditions by the anticipated date.
The merger's completion will lead to Hollysys delisting its shares from the NASDAQ Global Select Market, as the company has already informed the exchange of its intention to do so around the merger date.
Hollysys, established in 1993, has a significant presence in industrial automation and rail transportation sectors, providing a wide range of services including hardware, software, and enterprise manufacturing management. The company boasts a substantial project portfolio, having executed over 45,000 projects for around 23,000 clients in various industries as of June 30, 2023.
Ascendent Capital Partners, based in Hong Kong, manages assets for a global clientele comprising sovereign wealth funds, endowments, pensions, and foundations. The firm has a history of leading and executing private equity investments, advising entrepreneurs, and fostering business growth for its portfolio companies.
This press release contains forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. Hollysys cautions that these statements are subject to risks and uncertainties that could cause actual results to differ materially from anticipated outcomes. The company emphasizes that the forward-looking statements are based on current beliefs and expectations and should not be unduly relied upon.
The information for this article is based on a press release statement from Hollysys Automation Technologies Ltd.
In other recent news, Hollysys Automation Technologies Ltd. announced a significant shift in its auditing procedures, appointing Vocation HK CPA Limited as its new independent registered public accounting firm. This change, effective from May 28, 2024, follows the resignation of the previous firm, Union Power HK CPA Limited.
The decision was made by Hollysys' board and audit committee after a thorough evaluation process, and it is vital to note that Union Power's resignation was not due to any disputes over accounting practices or auditing procedures with Hollysys.
On another front, Hollysys' CEO, Dr. Changli Wang, recently sold a portion of his company shares for personal financial planning purposes. Despite this sale, Dr. Wang retains nearly 80% of his initial holdings, and he has stated no plans to sell additional shares before the completion of the company's going private transaction with Ascendent Capital Partners (ACP).
These are just a few of the recent developments at Hollysys. The company also reiterated its commitment to a merger agreement with a buyer entity under Ascendent Capital Partners. Both parties are actively working to meet the conditions necessary to finalize the merger. As these developments unfold, it is crucial to remember that the future results may differ due to various risks and uncertainties.
InvestingPro Insights
As Hollysys Automation Technologies Ltd. (NASDAQ: HOLI) prepares for its impending merger and subsequent delisting from NASDAQ, the company's financial health is of particular interest to investors.
With a market capitalization of $1.58 billion USD, Hollysys is positioned as a substantial player in the automation control systems industry. The company's Price to Earnings (P/E) ratio stands at 21.03, indicating investor expectations of future earnings growth, marginally adjusting to 20.95 when looking at the last twelve months as of Q3 2024.
Investors evaluating Hollysys' value proposition may note the company's Price to Book (P/B) ratio of 1.29, suggesting that the market values the company at a slight premium above its book value. The firm's revenue growth remains steady with a 3.6% increase in the last twelve months as of Q3 2024, coupled with a consistent quarterly growth rate of 3.48% in Q3 2024. This sustained growth trajectory is a positive indicator for stakeholders looking forward to the merger's completion.
For those interested in the finer details of Hollysys' operational performance, the company's gross profit margin stands at 31.07%, reflecting a healthy ability to translate sales into profit. Additionally, Hollysys' operating income margin of 8.63% demonstrates the firm's efficiency in managing its operating expenses relative to its revenue.
With these insights, investors have a snapshot of Hollysys' financial standing as it approaches a significant transition. For more comprehensive analysis and exclusive InvestingPro Tips, users can explore the InvestingPro platform, which offers an additional 5 tips for evaluating companies like Hollysys. Remember to use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, providing a valuable resource for informed investment decisions.
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