China’s Hongxin Surges on Plan to Buy Local Seller of Nvidia AI Gear
Tang Shihua
DATE:  Feb 19 2024
/ SOURCE:  Yicai
China’s Hongxin Surges on Plan to Buy Local Seller of Nvidia AI Gear China’s Hongxin Surges on Plan to Buy Local Seller of Nvidia AI Gear

(Yicai) Feb. 19 -- Shares of Hongxin Electronics Technology Group, a Chinese maker of flexible printed circuit boards that is expanding its business in artificial intelligence computing services, soared after the firm said it will acquire a local seller of Nvidia's AI equipment.

Hongxin [SHE: 300657] closed 14.5 percent higher at CNY15.11 (USD2.10) a share in Shenzhen today, after surging by as much as 16.2 percent in morning trading.

Hongxin will pen an agreement of intent with shareholders of An-link Technology to buy all of the Beijing-based company in a cash deal, the Xiamen-based buyer said yesterday. An-link is an elite partner of US chipmaker Nvidia.

Next, Hongxin will pay a CNY5 million (USD694,740) deposit within five days of signing the agreement and transfer the rest by year-end, though an appraisal will help determine the final price.

An-link has built up a rich client list and business experience, Hongxin said. It is qualified to sell Nvidia products such as servers and data center-grade graphics processing units in the country. An-link is expected to have had sales of almost CNY1 billion (USD138.9 million) last year, making it one of the top achievers in Nvidia’s China partnership network, Hongxin said.

The acquisition will help Hongxin deepen its connection with the technological and client resources of Nvidia's AI ecosystem to lay a solid foundation for building its AI computing service capabilities, covering chips from both Nvidia and Chinese vendors, it said.

Hongxin is building AI centers in Chinese cities, and leasing servers to tech firms that need to train AI models. Last October, Hongxin and Enflame signed a deal to upgrade their cooperation so that Hongxin will use AI chips developed by the Tencent-backed firm to assemble AI servers.

Editor: Emmi Laine

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Keywords:   Assets Acquisition,Nvidia Elite Partner,AI Chips,AI Computing Server Provider,Computing Power Infrastructure,Enflame,Hongxin Electronics