Major cable assembly maker BizLink Holding Inc., with 33 production bases worldwide, recently held its annual strategy meeting in Penang, Malaysia. This marked the first time the Taiwanese company held such a meeting in Penang, with upper management staff from around the globe rallying behind the slogan "One team, one goal."

Among the executives present were several new faces from the Industrial Solutions business group of German cable and harnessing manufacturer Leoni AG. BizLink acquired Leoni AG for €450 million in 2021.

Over the past decade, BizLink became widely known as one of Tesla's suppliers. However, the company now relies on its newly acquired Leoni Industrial Solutions to drive its business growth. In 2022, BizLink not only achieved an 88 percent increase in consolidated revenue but also broke the NT$50 billion mark with total revenue of US$300 million. .

Why did this overseas acquisition help BizLink achieve an all-time high in revenue?

Diversification from IT and electric cars

Previously, BizLink's revenue primarily came from four business areas: 34 percent from information technology and data centers, 28 percent from electric appliances, and 20 percent each from automotive use and industrial use products.

Chairman Roger Liang (梁華哲) explains that the revenue share of industrial computers has now risen to 40 percent, thanks to the German acquisition.

An analyst from a foreign company notes that focusing solely on consumer electronics would make BizLink susceptible to economic fluctuations.

On the other hand, the industrial computer production market is characterized by stable demand, despite small volumes and a wide variety of products. By leveraging the acquisition, BizLink entered a new market with a higher technical level. The opportunity for the acquisition arose in 2021 when Deutsche Bank approached BizLink.

Leoni AG, a global leader in cable and harness manufacturing with a history of over 100 years, had faced financial difficulties and was close to bankruptcy in recent years. As the creditor, Deutsche Bank invited potential buyers from around the globe, including BizLink, to make offers for the profitable Leoni Industrial Solutions business group.

"We bought them at the time, gritting our teeth," admits Liang.

Massive spending to strengthen the advantage of a short supply chain

Liang, with a background in semiconductor engineering, established an office in Taiwan, bought a factory in Shenzhen, China, and placed the headquarters in Silicon Valley, United States, all within two years.

However, the situation was different for this latest acquisition. Due to the pandemic, they couldn't inspect the production lines and had to rely on video conferences instead of on-site visits.

BizLink remained undeterred by the pandemic and pursued the acquisition, recognizing the potential that came with the resources of Leoni Industrial Solutions. The German company owns 15 factories in Europe and North America. As manufacturers worldwide aim to regionalize their supply chains and reduce geopolitical risks by producing closer to their customers, this transaction strengthens BizLink's ability to produce near its customers and gain a competitive edge through shorter supply chains.

Moreover, Leoni Industrial Solutions operated in various high-tech sectors, including semiconductors, medical devices, servers, national defense, and extreme environments. It boasted high-profile customers such as the German multinational conglomerate Siemens.

"The European customer supplier circle is very difficult to enter. They won't choose you just because you offer them a harnessing solution a few cents cheaper," notes Liang.

The merger was completed in January 2022. More than a year later, BizLink's revenue received a significant boost from industrial applications. Additionally, BizLink's production bases are now distributed globally, including in North America, Europe, East Asia, and Southeast Asia. However, thanks to the acquisition of Leoni Industrial Solutions, a significant portion of production is now based in Europe.

Unexpected gains: learning international corporate management

As the revenue structure changed, BizLink also had to upgrade its group's organizational management.

(Source: Ming-Tang Huang)

Liang emphasizes that BizLink, originally a small- and medium-sized enterprise, acquired a large enterprise with this latest acquisition.

"The biggest benefit of this acquisition is that we learned management," says Liang. Through the earlier merger of Leoni's Electrical Appliances business group, BizLink's management became aware of the many employees with business consulting backgrounds and impressive resumes at Leoni Industrial Solutions.

After the acquisition, they realized that the financial management system at Leoni Industrial Solutions was worth referencing. "At the strategy meeting in Penang, we also discussed how to create synergies," says Liang.

"One team, one goal" remains BizLink's growth strategy for the future following this crucial cross-border acquisition.

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Uploaded by Ian Huang