Naree Radar terminates 3.26 billion acquisition of Sigma; independent financial advisor for CITIC Securities

Shanghai Stock Exchange Discloses Termination of Review for Guangdong Narui Radar Technology Co., Ltd.'s Share Issuance, Asset Purchase, Cash Payment, and Supporting Fundraising

The Shanghai Stock Exchange (SSE) announced last night that it has decided to terminate the review of Guangdong Narui Radar Technology Co., Ltd.'s (hereinafter referred to as “Narui Radar,” 688522.SH) application for issuing shares and paying cash to purchase assets and raise supporting funds.

On June 26, 2025, the SSE lawfully accepted the application documents for Narui Radar’s share issuance and cash payment to purchase assets and raise supporting funds, and conducted a review in accordance with regulations.

Recently, Narui Radar and independent financial advisor CITIC Securities Co., Ltd. submitted to the SSE the “Application for Withdrawal of the Application Documents for the Share Issuance and Cash Payment to Purchase Assets and Raise Supporting Funds” and the “Application by CITIC Securities Co., Ltd. for Withdrawal of the Application Documents for the Share Issuance and Cash Payment to Purchase Assets and Raise Supporting Funds,” requesting to withdraw the application. According to Article 52, Item 2 of the SSE Rules for Major Asset Restructuring of Listed Companies, the SSE has decided to terminate the review of Narui Radar’s share issuance and cash payment to purchase assets and raise supporting funds.

The independent financial advisor for this transaction is CITIC Securities Co., Ltd., with Xie Zhuoran and Liu Zhifeng serving as lead financial advisors.

According to the draft (revised) report on the issuance of shares and cash payment to purchase assets and raise supporting funds disclosed by Narui Radar on February 28, 2026, the company plans to acquire 100% equity of Tianjin Sigma Microelectronics Technology Co., Ltd. from 12 counterparties, including Zhou Qifeng, Li Ying, Tianjin Haoxiwang Microelectronics Technology Partnership (Limited Partnership), Li Zhiqian, Shenzhen Juren Chengchang Information Technology Enterprise (Limited Partnership), Shenzhen Juxian Chengchang New Technology Enterprise (Limited Partnership), Shenzhen Junpeng Shuneng Investment Partnership (Limited Partnership), Li Xingang, Shenzhen Caihui Juren Information Technology Consulting Enterprise (Limited Partnership), Jinhua Jinkai De Honglianxin Bifang No. 2 Investment Center (Limited Partnership), SMIC Hainan Saida (Tianjin) Industrial Investment Fund Center (Limited Partnership), and Jiaxing Junke Phase II Equity Investment Partnership (Limited Partnership).

Using June 30, 2025, as the valuation date, Zhonghe Evaluation applied both income and market approaches to evaluate Tianjin Sigma Microelectronics, selecting the income approach results as the final valuation.

As of June 30, 2025, the valuation of 100% equity of the target company was 326.08 million yuan, with an appreciation rate of 297.17%.

Based on this valuation, after negotiations with the counterparties, the final transaction price for 100% equity of Tianjin Sigma Microelectronics was set at 326 million yuan.

In this transaction, the company plans to raise supporting funds through an inquiry-based issuance of shares to no more than 35 qualified investors. The total amount of funds raised will not exceed 163 million yuan, and the number of shares issued will not exceed 30% of the company’s total share capital after the transaction. The final number of shares to be issued will be determined after review by the SSE and registration with the China Securities Regulatory Commission, based on the inquiry results. The raised funds are intended to pay the cash consideration for the transaction.

Based on full and equal negotiations, considering the interests of all parties, the company has set the issuance price for the shares in this transaction at 42.93 yuan per share, which is no less than 80% of the average trading price of the company’s stock over the 120 trading days prior to the pricing date.

Due to the implementation of the 2024 profit distribution, capital reserve conversion to share capital, and the 2025 semi-annual profit distribution, the issuance price for the shares involved in this transaction was adjusted from 42.93 yuan per share to 30.56 yuan per share.

The total transaction consideration for the 100% equity of Tianjin Sigma Microelectronics is 326 million yuan, with 50% paid in shares, i.e., 163 million yuan. Based on the issuance price of 30.56 yuan per share, the number of shares to be issued for the purchase is 5,333,768 shares.

The company is a domestic leader in key core technologies for fully polarized active phased array radars and was among the earliest to commercialize dual-polarization (bipolarization) active phased array radar technology. Since its founding, the company has driven technological innovation, focusing on providing solutions for fully polarized active phased array radar detection systems. Its current products mainly include X-band dual-polarization (bipolarization) active phased array radars and supporting hardware and software, primarily used in meteorological detection, water conservancy, and rainfall measurement, with gradual expansion into civil aviation, ocean monitoring, low-altitude economy, and public safety monitoring markets.

The target company is a specialized integrated circuit design enterprise, mainly engaged in R&D, design, and sales of digital, analog, and mixed-signal ASICs such as optoelectronic sensors, MCU chips, touch chips, and power management chips. It offers one-stop chip customization services and has a mature patent portfolio in ADC and DAC technologies.

According to Narui Radar’s announcement, this transaction is aimed at vertically supplementing the company’s phased array radar main business, with no fundamental change to the company’s core operations. After completion, by integrating the target company’s technology and supply chain resources, the company aims to strengthen its low-cost industrialization advantage, develop independent chip technology, enhance the technological competitiveness of radar products, and upgrade radar system development from “component-level integration” to “chip-level collaboration.” This will improve R&D efficiency for next-generation high-performance radars, meet market demands, and enhance the company’s sustainable operation and market competitiveness.

On March 1, 2023, Narui Radar was listed on the STAR Market of the SSE, issuing 38.6668 million shares, accounting for about 25% of the total post-issuance share capital, at an issue price of 46.68 yuan per share. The sponsor (lead underwriter) was CITIC Securities Co., Ltd., with Wang Chang and Zhang Jinsheng as sponsoring representatives.

The total funds raised from the listing were approximately 1.805 billion yuan, with net proceeds after issuance expenses of about 1.654 billion yuan, exceeding the original plan by 686.2 million yuan. According to the prospectus disclosed on February 24, 2023, Narui Radar planned to raise 968 million yuan, mainly for the R&D and industrialization of fully polarized active phased array radar and working capital.

The total issuance costs for the new shares were 150.81 million yuan (excluding tax), with CITIC Securities earning underwriting and sponsorship fees of 126.35 million yuan.

CITIC Securities Investment Co., Ltd. (a subsidiary involved in co-investment) was allocated 128.5347 shares, representing 3.32% of the initial public offering, with an allocation amount of approximately 59.9999 million yuan. No brokerage commissions were paid for the new share placement. The lock-up period for the shares allocated to CITIC Securities Investment Co., Ltd. is 24 months from the date of Narui Radar’s first listing and trading.