|Setting up a China JV for Manufacturing of Mine Support Products|
A mining support product company and subsidiary of a large mining machinery group intended to move their production to China in order to supply their domestic and international markets at lower cost. The company aimed to market their own patented products in China, by combining their unique technology with localised product functions in order to better serve Chinese mining customers.
The Beijing Axis initially conducted comprehensive research on the Chinese mining support industry, and analysed various competitors, product ranges, available technology and safety policies. As a result of this research, a shortlist of qualified potential OEM manufacturers and JV partners was produced. For over half a year, the client visited the identified potential partners with The Beijing Axis, and ultimately selected one partner for the JV. The Beijing Axis facilitated all aspects of the deal process, i.e. comprehensive partner due diligence, negotiation, strategic advice, structuring, legal service provider management and relationship management - adding value throughout the process at both a strategic and implementation levels. The Beijing Axis also helped manage regulator relationships and engaged with various officials and government departments to drive the overall approval process.
A 50-50 JV was formed and both partners agreed to jointly own the patents of the designed product. The technology used in the end product used contributions from both partners, with the products' quality and safety standards meeting both Chinese and international requirements. The client's production cost has been significantly reduced while production capacity has expanded.