Source丨IT orange
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The IT Orange Weekly Report, which is updated every Monday, takes stock of the major events worth paying attention to in the venture capital circle, discovers the latest investment actions of the giants, observes the VC fundraising vane, and sees which new economy companies are becoming unicorns and on the way to IPO - allowing you to keep abreast of valuable information and trends in new economy venture capital.
Headlines
1. WT Announces $3.8 Billion Acquisition of Future ClosesTaiwan-based semiconductor company WT announced the successful completion of the acquisition of Future Electronics, which will set up dual headquarters in Taipei and Montreal in the future. Founded in 1968, Future Electronics is the world's third-largest distributor of electronic components, headquartered in the western suburbs of Montreal, Quebec, Canada, and operating in 47 countries with 5,200 employees worldwide. In September 2023, WT Microelectronics Co., Ltd. announced that it had signed a definitive agreement to acquire 100% of Future Electronics Inc. for an all-cash transaction enterprise value of US$3.8 billion (C$5 billion). Future Electronics' revenue for the first half of 2023 was $2.9 billion, operating profit was $228 million, and net income was $184 million. It is understood that this is also the largest amount of foreign mergers and acquisitions by Chinese Taiwan enterprises in history. This transaction is also another important milestone in WT's global expansion following the acquisition of Singapore's Shangshijian Technology. Robert G. Miller, the founder of Future Electronics, was previously facing a class action lawsuit by 28 women and is under investigation for allegedly engaging in sex trafficking with minors. According to unsubstantiated court documents, the acts took place between 1992 and 2012. Miller's wife suspected her husband of having sex with a minor, and she hired some private detectives to investigate the matter, the report said. Back on November 4, 2009, the Montreal Police Child Sexual Exploitation Investigation Unit executed a search warrant for the Future Electronics Distributor Building on Hymus Avenue. In February last year, the 80-year-old Miller stepped down as president of Future Electronics after the lawsuit was exposed by the media. As a result of the scandal, Future Electronics was forced to consider a sale.
According to Gartner, WT and Future together accounted for 12.2% of the global semiconductor distribution market last year, which is not only the largest in Asia, but also the largest semiconductor distributor in the world.
(Source: Electronic Innovation Network) 2. Recently, Zhufaner announced that it has received a strategic investment of 100 million yuan from Whale Capital, which will be mainly used to increase brand building and brand promotion in Beijing and Shanghai, and continue to optimize and innovate Zhufaner's products and services. From the perspective of the general environment, the large home furnishing industry is very lively, but the decoration industry is still relatively cold, and there are very few companies that can continue to finance. According to incomplete statistics, in the home improvement track, only 2 companies have successfully financed in the past three years, and the single financing amount has not exceeded 100 million, and the overall financing scale is small. Zhufaner is committed to improving the living experience of young people through renovation and decoration services, and solving the problems of old decoration style, uncoordinated interior collocation, and local functional damage that are common in domestic houses. Since entering the industry in 2015, Zhufaner has not entered new cities in a big way, but has continued to cultivate the three key cities of Beijing, Shanghai and Chengdu. In the context of the stock market, the selection of key first-tier cities as the main position of product promotion is related to the gradual increase in the proportion of second-hand housing transactions in related cities. Taking Beijing as an example, since 2009, when the number of second-hand residential online signatures in Beijing surpassed that of new homes for the first time, the Beijing real estate market has officially entered the era of stock. In addition, at present, Zhufaner has also opened two offline stores: Beijing Zhufaner Super Home Mall (opened in March 2022) and Shanghai Zhufaner Home Life Experience Center.
Zhang Dong, CMO of Fanke Group, said that it is right that Zhufan did not carry out urban expansion, because they have not yet penetrated a single city, and the model has not been fully run, and blind expansion will only accelerate the crisis. The correct business path is to carry out the national replicable development after the model is completely run through in a single city, otherwise the foundation is not solid, and the risk will be greater.
(Source: Caijing.com)3. On March 30, Dalian Wanda Commercial Management Group formally signed an investment agreement with PAG Investment Group, Abu Dhabi Investment Authority, Mubadala Investment Company, CITIC Capital and ARES in Dalian, under which the above five institutions will jointly invest about RMB 60 billion in Dalian Xindameng Commercial Management Co., Ltd., holding a total of 60% of the shares, and Dalian Wanda Commercial Management will hold 40% of the shares. Dalian Sundameng Commercial Management Co., Ltd. is a newly established holding company, established in January 2024, and its subsidiary, Zhuhai Wanda Commercial Management, is a commercial plaza operation and management platform that currently manages 496 large commercial plazas. 4. Brandtech Raises $115 Million Series C Funding Brandtech announced a $115 million Series C funding round co-invested by Fimalac and Nendo Labs, as well as longtime shareholders Mousse Partners and Bansk Group. After this round of funding, Brandtech's company is valued at approximately $4 billion. Brandtech, a generative AI platform provider, has developed Pencil, a generative AI platform that generates the marketing content that users want, such as videos/images, and predicts the effectiveness of a brand's advertising.
In the past year, Pencil has generated more than 1 million ad creatives for brands. Brandtech's current clients include internationally renowned companies such as Google, Microsoft, Unilever, LVMH, Morgan Stanley, Bayer, TikTok, Diageo, Reckitt Benckiser and Renault-Nissan.
In the past quarter, the number of new economy private equity investment transactions has shown a stable trend in the cyclical amplitude. Around the Qingming Festival holiday, the number of investment transactions declined to a certain extent. According to IT Orange statistics, there were 96 investment and M&A transactions last week.
Last week, the most popular tracks for investors were biotechnology and pharmaceuticals, integrated circuits, blockchain application technology, AI industry applications, new energy, intelligent equipment, medical devices, and new materials.
Selected Primary Market Investment and Financing CasesAI: MyTwins.ai has recently completed an angel round of financing of 10 million RMB, which was jointly led by Jiangmen Venture Capital, Yongxi Asset Management and Westlake Science and Technology Venture Capital, with Yuanqi Capital as the exclusive financial advisor. The funds will be mainly used for technology research and development, equipment procurement, market expansion, etc. Maitu Intelligent MyTwins.ai is committed to creating digital avatars for everyone through general artificial intelligence (AGI) technology, making digital avatars the best medium for personal external publicity, communication and service. Consumption: Recently, Jiandan Sports completed tens of millions of yuan in A+ round of financing, which was led by Guizhou Cultural Investment and followed by Maichun E-commerce. Jiandan's sports is a community intelligent health platform under Weining Technology, which has a number of brands such as "Jiandan's Fitness", "Egg Boy Squad", and "Ning's Vitality Pilates", covering community fitness, children's sports and other subdivisions. Since 2021, Egg Sports has incubated the brand matrix and launched the "Egg Boy Squad" children's sports hall focusing on children's physical fitness, and opened its first community store in the same year. In 2022, the number of online stores on the Jiandan Sports platform will exceed 200+. Corporate services: Jingce Electronics issued the "Announcement of Wuhan Jingce Electronics Group Co., Ltd. on Signing the "Capital Increase Agreement" and the Progress of Foreign Investment, and the company has passed the deliberation of the board of directors meeting and agreed to contribute 50,000 yuan to the company, of which 12,735,670 yuan is included in the paid-in registered capital and 487,264,330 yuan is included in the capital reserve. After this capital increase, the company will hold 43.38% of the equity of the company. Jiangcheng Science and Technology Service is a science and technology service and transformation platform provider, focusing on providing enterprises, universities and research institutes with advanced packaging technology solutions, core materials and key equipment verification services, integrated circuit high-performance chip design services, science and technology consulting services, science and technology financial services, science and technology conference and exhibition services, park operation and incubation, etc. Intelligent manufacturing: Recently, ROKASHI Robotics has completed a strategic round of financing of more than 500 million yuan, which is led by the National Manufacturing Transformation and Upgrading Fund and participated in the investment by Zou Cheng New Kinetic Energy Industry Investment Fund. ROKASHI Robotics is a light industrial robot developer, mainly providing collaborative industrial robot control systems, industrial robot products and intelligent manufacturing solutions, etc., its products have been widely used in grinding, loading and unloading, assembly, sorting, quality inspection, sewing and other fields. This round of financing will be mainly used for market development, international development, product upgrading and iteration, and refined operation management. Riguan Core Design recently completed tens of millions of yuan in Pre-A round of financing, and the investors in this round are Industrial Capital Skyworth Investment, Production and Research Zhongxiang, etc. The financing funds will be mainly used for marketing and product upgrade and iterative research and development. Potential Energy Capital acted as the financial advisor for this round of financing. Riguan Core focuses on the field of electronic design automation (EDA) in the field of integrated circuits, aiming to create a domestic independent EDA digital signoff process and full-chip optimization system for integrated circuit design. Medical: Recently, Inzheng Gene completed a Pre-A+ round of financing of 10 million US dollars. The round of financing was co-led by Suntech Pharma Group and its subsidiary, Suntian Pharmaceutical, followed by Qiming Venture Partners, the Innovation and Technology Venture Fund of the Innovation and Technology Commission of the Government of the Hong Kong Special Administrative Region, and the Hong Kong Science and Technology Parks Venture Fund. Ingenomics is a gene editing platform technology solution provider, a gene editing platform technology company, focusing on the development of the underlying technology of gene editing tools. The company has developed next-generation CRISPR-based gene editing tools that improve the efficiency and precision of gene editing and reduce off-target effects. Recently, ETERN Therapeutics announced the opening of a B+ round of financing. The first tranche of funding was led by AstraZeneca CICC Medical Industry Fund and Wuxi Investment Holding Group, followed by Tin Venture Capital. The Series B+ funding will be used to accelerate the construction of Yituo's LLPS protein liquid-liquid phase separation technology platform, and continue to advance the early development and clinical research of the company's projects. Focusing on the research and development of small molecule drugs targeting protein liquid-liquid phase separation, Yituo Pharma has independently developed the world's leading protein liquid-liquid phase separation technology platform - LLPS platform. The platform integrates AI-enabled phase separation target discovery, high-throughput and high-content drug screening, and drug optimization. The development of small molecule drugs that can regulate the liquid-liquid phase separation of proteins is expected to open up new therapeutic strategies for many major diseases with unmet clinical needs.
More Featured Investment Events:
Major M&A cases
1. Trend brand Champion to be acquired U.S. brand management company Authentic Brands Group announced that it has reached a preliminary agreement with apparel group HanesBrands to acquire fashion brand Champion for about $1 billion, and will officially complete the acquisition in May and June. Champion is a century-old outdoor sports and leisure brand, in 1919, Simon Feinbloom and his father officially established the "Champion" brand in Rochester, New York, USA. Champion is known worldwide for creating hooded sweatshirts and reverse knitting, and has been granted a patent for the horizontal knitting technique, and the "Champion" brand is also a permanent sponsor of NBA jerseys. In July 2022, footwear company Wolverine Worldwide announced that its subsidiary, Keds, had sold the trademark licensing rights for Champion's footwear in the United States and Canada to its distributor, HanesBrands Group, for up to US$90 million (about 600 million yuan). HanesBrands listed Champion for sale in 2023 with a starting bid of $1.4 billion. It is understood that Authentic Brands Group has successively acquired fashion brands such as Forever 21, Brooks Brothers and Ted Baker. 2. Advent Capital Proposes $6.3 Billion Acquisition of Nuvei Montreal-based Canadian payments technology company Nuvei Corporation (TSX: NVEI) (NASDAQ: NVEI) recently announced that it has signed a going-private agreement with U.S. private equity firm Advent. Last year, the company also received investment from Canadian actor Ryan Reynolds. The all-cash deal values Nuvei at $6.3 billion, or $34 per share, and has been approved by existing Canadian shareholders, Nuvei's CEO Philip Fayer, private equity firm Novacap, and pension fund CDPQ. Nuvei went public on the Toronto Stock Exchange in September 2020 with a $700 million initial public offering, making it the largest technology company IPO ever on the Toronto Stock Exchange at the time. In October 2021, Nuvei was listed on the NASDAQ exchange in the United States. According to the statement, Nuvei's current CEO, Philip Fayer, will continue to lead the company, and Nuvei will remain headquartered in Montreal. The transaction is expected to close by the end of 2024 or the first quarter of 2025. Richard Tse, an analyst at National Bank of Canada, believes the deal is "reasonably valued" and believes a bid is unlikely, given the non-solicitation agreement on the Nuvei side and the hefty "break-up fee" of up to C$150 million.
Back in 2022, the analyst listed Nuvei as a "potential acquisition candidate."
(Source: NAI500)3. AUO Announces Completion of EUR 600 Million Acquisition of BHTC in Germany AUO Optronics has completed the formal acquisition of Behr-Hella Thermocontrol GmbH (BHTC) in Germany for EUR 600 million (RMB 4.674 billion). AUO Chairman Peng Shuanglang said that BHTC has factories in Europe, North America, India and Chinese mainland, which is crucial to the local automotive supply chain. This year, AUO will also decide whether to set up manufacturing bases in Europe and North America, which will enable AUO to achieve its strategic goal of dual-axis transformation and bring key steps for the company. Founded in 1999, BHTC is headquartered in Lippstadt, Germany, with subsidiaries in the United States, Japan, Bulgaria, Finland, Mexico, India and China. The Company is principally engaged in the research and development, manufacturing and sales of automotive human-machine interface (HMI), automotive climate control system (Climate Control) and electronic control components. BHTC has Tier 1 capabilities and customers include Audi, BMW, Bentley, Bugatti, Daimler, Chrysler, Porsche, GM, Lamborghini, Volvo and Wolfsburg , and other well-known companies and brands. More M&A & Exits:
VC Fundraising News1. Shenzhen Guidance Fund and Fosun Pharma Joint Venture Fund EstablishedShenzhen Pengfu Biomedical Industry Private Equity Investment Fund Partnership (Limited Partnership), a fund under Fosun Pharma, was established recently, with Shenzhen Fuxin Shenyao Investment Partnership (Limited Partnership) as the executive partner, with a capital contribution of RMB 5 billion. According to the partner information, the company is jointly funded by Shenzhen Guidance Fund Investment Co., Ltd., Fosun Pharmaceutical Industry Development (Shenzhen) Co., Ltd., a subsidiary of Fosun Pharma, and Shenzhen Pingshan District Guidance Fund Investment Co., Ltd.
There are no new unicorns
New Economy IPOs and Post-IPO Dynamics1. Mobvoi passed the hearing of the Hong Kong Stock Exchange According to the documents of the Hong Kong Stock Exchange, Mobvoi Inc. recently passed the listing hearing of the Hong Kong Stock Exchange, and disclosed the information set after the hearing on April 2, and intends to be listed on the main board. Mobvoi was founded by Chinese AI scientist Li Zhifei who returned to China in 2012. After receiving his Ph.D. in computer science from Johns Hopkins University, Zhifei Li worked at Google Inc. in the United States and is an expert in the field of natural language processing (NLP). From fiscal year 2021 to fiscal year 2023, Mobvoi's AIGC solution revenue will be 6.822 million yuan, 39.857 million yuan, and 118 million yuan, accounting for 1.7%, 8%, and 24% of the total revenue, respectively. Mobvoi's last funding round was closed in September 2019 at a valuation of around $756 million at the time. After 2019, Mobvoi has not received external financing for 5 years, and its current liabilities exceed 4.5 billion yuan, and the company faces liquidity risks. In 2017, Volkswagen invested US$180 million in Mobvoi, and the two parties established a joint venture Volkswagen to develop "AI in-vehicle technology". Since then, providing AI software solutions to the masses has become an important source of revenue for Mobvoi. At the end of 2021, Mobvoi redeemed Volkswagen's share of its investment, and Volkswagen acquired 50% of the shares of Volkswagen held by Mobvoi, completing the "decoupling" of the equity of the two parties. But in 2022, Mobvoi's revenue from Volkswagen still accounts for 42.6%. Before the IPO, in addition to Google, Mobvoi's shareholders included Sequoia China, Zhen Fund, Volkswagen Group, Goertek, etc., of which Google held 13.36% of the shares and Sequoia China held 10.92% of the shares.
For the entire FY2023 period, Li Zhifei's total salary, including equity-settled share-based expenses, discretionary bonuses, allowances and benefits in kind, amounted to RMB6.543 million.
(Source: Yicai)
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