(Yicai Global) Oct. 28 - Chinese electronics giant Xiaomi Technology offered CNY139 million (USD20.7 million) yesterday to gain a 5.01 percent stake in Dong Yi Ri Sheng Home Decoration Group to jointly help customers enhance their smart home experience with Internet of Things technology.

The target’s controlling shareholders, husband and wife Chen Hui and Yang Jing, will sell 21 million shares of the listed firm to Xiaomi Technology Wuhan for about CNY6.6 (98.8 US Cents), Beijing-based Dong Yi Ri Sheng said in a statement yesterday, citing the equity transfer agreement inked the same day.

The home decorator was to issue 22.08 million new shares to Xiaomi for about CNY6.10 per share, while Xiaomi was to spendCNY134 million to secure a 5 percent stake, per their preliminary agreement in July.

Chinese entrepreneur Lei Jun founded and controls both Xiaomi Technology Wuhan and Hong Kong-listed Xiaomi [HKG:1810], which was up 0.47 percent at midmorning at HKD21.15 (USD2.73). Dong Yi Ri Sheng [SHE:002713] also rose, and was up 2.1 percent to CNY8.26 (USD1.23).

Xiaomi will become Dong Yi Ri Sheng’s second-largest shareholder post-transaction, per the statement, which added it and Xiaomi will collaborate to provide consumers with digitized smart-home services based on Xiaomi’s intelligent IoT technologies and Dong Yi Ri Sheng’s home decoration marketing prowess.

Founded in 2010, Xiaomi owns the world’s fourth-largest smartphone brand and a consumption-themed IoT platform that connects some 252 million smart devices -- excluding handsets and personal computers. The company has actively invested in industry chain-related the companies in recent years to form a business ecology where smart hardware, internet-based services and new retail converge, and had bought into more than 300 such firms by the first quarter’s end.

Editor: Ben Armour