Billion yuan acquisition targets low-margin PC upgrade

The acquisition of Becoming Information by Billion Information was disclosed on September 18 2026. The transaction amounts to 715 million CNY and involves a full share swap. The target reported 318 million CNY revenue for 2025 with a 42.35 percent gross margin, significantly higher than Billion Information's 9.76 percent margin on smart hardware. However the deal adds an estimated 490.5 million CNY of goodwill and faces risks from declining sales and rising PCBA costs. The target specializes in smart data collection terminals, ultra-high frequency RFID modules and intelligent vehicle terminals, serving logistics warehousing retail and smart manufacturing sectors. Its net profit was 53.65 million CNY in 2025 but revenue has fallen for three consecutive years. The revised draft shows half year revenue of 192 million CNY and net profit of 30.55 million CNY with 41.36 million CNY of outstanding orders and 2.405 billion CNY of reserved orders. Core portable data collection terminals saw unit sales drop from 129500 units in 2023 to 72600 units in 2024 while price rose from 1162.31 CNY to 1268.46 CNY.

The first evaluation used September 30 2025 as baseline with net assets of 269 million CNY and valuation of 805 million CNY yielding an 198.90 percent premium. After a 90 million CNY capital reduction the deal price settled at 715 million CNY. The transaction is expected to generate 490.5 million CNY of goodwill representing 19.11 percent of the combined net assets as of March 2026. The seller commits to profit guarantees of at least 57 million CNY in 2026 60 million CNY in 2027 and 63 million CNY in 2028 with a cumulative minimum of 180 million CNY. Prior to the merger Becoming Information had pursued a standalone listing but abandoned the plan after a six month tutoring program ended in March 2025. The buyer focuses on rugged smart terminals XR and AIoT with 27.46 billion CNY revenue in the first half of 2026 where smart hardware accounts for 17.18 billion CNY or 62.56 percent and rugged terminals account for 2.90 billion CNY or 10.56 percent. Smart hardware margin stands at only 9.09 percent while rugged terminals achieve 40.37 percent. The low margin reflects declining PC industry prospects with IDC forecasting an 11.3 percent shipment decline in 2026. Storage cost increases may further depress PC shipments by 10.4 percent and raise average prices by 17 percent.

Billion Information's smart hardware cost structure is heavily weighted toward direct materials representing 93.79 percent of 27.55 billion CNY. Chip price hikes have already pushed PCBA prices up significantly after the evaluation baseline. The company is advancing an AI plus strategy with AI PC shipments growing 36.13 percent year on year in the first half of 2026. Its rugged terminals have entered smart manufacturing logistics transportation and utility sectors with ONERugged brand revenue rising 177.04 percent year on year. The acquisition combines Billion Information's front end recognition and data collection capabilities with Billion Information's back end computing and interaction strengths forming an end to end industrial intelligence solution. The 715 million CNY purchase represents an attempt to upgrade away from low margin PC competition but success depends on order synergies and profit commitments.

Reported by TMTPost.