Aerospace Hi-Tech to sell drilling system unit intangible assets

Aerospace Science and Industry Inertial Technology Co., a subsidiary of Aerospace Hi-Tech Holding Group, intends to transfer 50% of its stake in intangible assets related to the China-made rotary steerable drilling (CG STEER) system. The asset portfolio, including two software copyrights and 117 patents and proprietary technologies, was valued at 98.9 million yuan as of October 20, 2024. Inertial Company’s 50% share is valued at 49.45 million yuan. The sale will proceed via public auction, with the final transaction price determined by a property rights exchange.

This divestment aligns with Aerospace Hi-Tech’s new development strategy to focus on its core aerospace applications business. The proceeds from the sale will optimize the financial position of the holding company and increase the Inertial Company's cash reserves, primarily supporting its core business development. The transaction is considered an associated transaction because Sichuan Tiantexin Technology Co., a potential buyer, and Inertial Company share China Aerospace Science and Industry Corporation Limited as their ultimate controlling shareholder.

The transfer of these intangible assets, stemming from early-stage research and development, are currently not recognized on the balance sheet. This transaction is expected to generate a pre-tax profit of 49.45 million yuan for Aerospace Hi-Tech Holding Group.