TIANYU SEMI (02658) plans to acquire approximately 7% stake in Zhejiang Tony Electronic for RMB400.1 million

TIANYU SEMI (02658) announced that on November 6, 2026, the Company entered into a share transfer agreement with Mr. Shen Xinfang, pursuant to which the Company has conditionally agreed to acquire, and the seller has conditionally agreed to sell, 16.271 million A shares of the target company, representing approximately 7% of its total issued share capital, for a total cash consideration of RMB400.1 million, equivalent to RMB24.59 per sale share. The consideration will be funded by the Group's internal resources and part of the net proceeds from the global offering. The acquisition aims to strengthen the long-term cooperation between the Group and the target group in the silicon carbide business, including supply chain coordination and joint research and development related to large-diameter silicon carbide materials. The target company, Zhejiang Tony Electronic Co., Ltd., is a joint stock company incorporated in China whose A shares are listed on the SSE (stock code: 603595). Its business covers metal-based materials and composite materials as well as third-generation semiconductor materials (including silicon carbide substrates), and products for consumer electronics, photovoltaic and medical applications. Its semiconductor subsidiary develops and manufactures silicon carbide substrates, including 6-inch and 8-inch conductive-type substrates. The directors believe that the acquisition will provide a basis for closer strategic cooperation between the Group and the target group and bring the following potential benefits under the commercial arrangements agreed between the parties: (i) Strengthening the silicon carbide supply chain. Combining the Group's expertise in silicon carbide epitaxy with the target group's capabilities in crystal growth and substrate processing can enhance coordination between substrate production and epitaxial growth. This cooperation is expected to support a reliable supply of 6-inch and 8-inch conductive-type substrates, improve quality consistency and production yield, and reduce procurement costs and supply risks. (ii) Accelerating research and development. Joint development of crystal growth, substrate processing and epitaxy can improve material quality and accelerate the development of larger-diameter (including 8-inch and above) silicon carbide materials for high-voltage and automotive-grade applications. Closer technical coordination can also shorten the sample delivery and customer certification cycles for products serving electric vehicles, artificial intelligence data centers, energy storage and power grids. (iii) Expanding customer and product opportunities. The two parties serve complementary downstream markets, particularly electric vehicles, artificial intelligence data centers, photovoltaics and energy storage. Cooperation involving silicon carbide power semiconductor materials and the target group's broader electronic materials capabilities can support a more comprehensive product offering, strengthen customer relationships and generate additional business opportunities in these applications. (iv) Sharing technical and operational expertise. Collaboration between the two parties' materials engineering, epitaxial process and quality management teams can support quality traceability from crystal growth to epitaxy, improve cleanroom management and reliability testing, and share testing and analytical facilities, thereby improving operational efficiency and reducing duplicate testing and certification expenses.