The automotive parts include fog lamp, daytime running lamp, brake lamp and other lamps under consent of the two companies.
In a filing with Bursa Malaysia today, MCE said its wholly-owned subsidiary Multi-Code Electronics Industries (M) Bhd (MCE) has signed a memorandum of understanding (MoU) with Juoku for the proposed collaboration. Juoku is a manufacturer of lighting systems and plastic moulding parts for the automotive industries.
The MoU will remain in force for one year.
"The parties have agreed to enter into a definitive agreement to develop, manufacture and market automotive lighting systems in Malaysia using the technology and technical assistance provided by Juoku," it added.
Under the proposed collaboration, MCE will manufacture, assemble and promote the automotive lighting parts, while Juoku will provide the technology for product development and technical assistance to manufacture them.
MCE said: "It is clarified that for the duration of this MoU and any definitive agreement or understanding entered into by MCE and Juoku, MCE will be the only partner to Juoku for its Malaysian operation," said MCE.
"The MoU will not have any material effect on the group's issued and paid-up capital, net assets and earnings for the financial year ending July 31, 2020," it added.
MCE shares closed down five sen or 12.5% at 35 sen today, giving the group a market capitalisation of RM15.54 million. A total of 18,000 shares were traded.
Source: The Edge Markets