Zhongfutong plans to acquire 64% of Inboda's equity for RMB 18 million to deploy AI edge computing

On the evening of January 13, Zhongfutong announced that on January 11, 2021, the company signed a "Share Acquisition Intention and Capital Increase Agreement" with Xu Jingyu, a shareholder of Shenzhen Yingboda Intelligent Technology Co., Ltd. (hereinafter referred to as "Yingboda"), and planned to acquire 64% of Yingboda's equity held by Xu Jingyu in cash. The estimated transaction amount is not more than 18 million yuan.

Within 30 days from the date of completion of the industrial and commercial change registration of this equity transfer, Zhongfutong will increase its registered capital and subscribe for all the new registered capital of Yingboda with RMB 5 million in cash, of which RMB 400,000 will be included in the registered capital and the remaining RMB 4.6 million will be included in Yingboda's capital reserve.

After the capital increase is completed, Inboda’s registered capital will be changed to 2.4 million yuan. Zhongfutong will hold 70% of Inboda’s shares (corresponding to a registered capital of 1.68 million yuan), and Xu Jingyu will hold 30% of the shares.

According to Tianyancha data, Inboda was established on February 7, 2018, with a registered capital of 2 million yuan and a paid-in capital of 311,000 yuan. Its main business is the technical development and sales of artificial intelligence product hardware and software; the technical development, testing and sales of computer hardware and software; the technical development and sales of electronic products, communication products, and smart hardware products, and the technical development and sales of new energy vehicle electronics and control software.

As the scale of operation continues to expand, Inboda's net profit has shown a trend of year-on-year losses and continued expansion. In 2018, 2019 and the first half of 2020, Inboda achieved operating income of 1.4945 million yuan, 2.3197 million yuan and 1.2013 million yuan respectively, and net profits of -228,900 yuan, -2.1144 million yuan and -1.0015 million yuan respectively.

In this transaction, Inboda made a performance commitment to Zhongfutong, promising that its net profit in 2021 and 2022 would not be less than 5 million yuan. If the above-mentioned performance commitment is not achieved, Xu Jingyu will make up the difference in profit to Inboda in cash, and the two parties will distribute all the profits of Inboda (including the part made up by Xu Jingyu) in accordance with the proportion of the actual capital contribution to Inboda.

However, if Inboda achieves the performance promised by Xu Jingyu in 2021 and 2022, Zhongfutong will acquire Xu Jingyu's equity in Inboda depending on Inboda's operating conditions, or make additional capital increases to Inboda. The specific matters will be determined by negotiation between the two parties.

Judging from Inboda’s current performance, it will be difficult to achieve its performance commitment targets.

Regarding this acquisition, Zhongfutong stated that with the development of 5G communication technology, the traditional centralized processing model of cloud computing plus terminal services is difficult to meet the needs of large-scale data transmission and real-time processing. Communication operators have an increasingly strong demand for cloud-network integration. As the evolution and development of cloud computing, artificial intelligence edge computing technology has the characteristics of being close to applications, intelligent and flexible, and distributed and efficient. It has become one of the important technologies in the 5G era.

Inboda is a company focused on the research and development of edge computing products. It has a group of edge computing and artificial intelligence cutting-edge development teams with rich experience. The team leader Xu Jingyu worked in a Fortune 500 chip company for thirteen years, responsible for research and development and management.

Based on the cooperation between the two parties, Inboda will accelerate the research and development and application of edge computing related products, and launch a series of edge computing products with powerful computing capabilities and rich communication means to cope with complex application scenarios such as smart manufacturing, autonomous driving, smart security, smart home, etc., and push and analyze information to users in near real time.

Zhongfutong stated that the company started to deploy 5G edge computing in 2017. The acquisition of Inboda has consolidated the company's edge computing hardware research and development capabilities and completed a closed loop in technology. It is in line with the company's current positioning as an "integrated communications technology service provider" and its layout for the 5G massive data market. It will help the company's business expand from the original communications technology operation and maintenance services to the construction and operation of big data platforms and edge computing, create new value around front-end equipment and data, and create a low-cost, high-efficiency intelligent environment for user applications, which will help to continuously enhance the company's core competitiveness.