"Mobile repair" marriage "selling phones" faces investor "disapproval" Baibang Technology resumes trading with a sharp decline

On April 1st, the A-share market experienced a dramatic scene, with the control change suspension of trading, Two-Sided Needle (600249.SH) hitting the limit-up and being locked, while Bai Bang Technology (300736.SZ) opened lower and declined further, ultimately closing down sharply by 12.15%, with the market voting with their feet. Behind this is a capital marriage between the “phone repair” business and the “phone selling” business, but investors seem not to buy it.

According to the announcement, Bai Bang Technology’s original controlling shareholders Daan Century, Yuehua Zhongcheng, and Nanjing Dele Technology Group Co., Ltd. (referred to as “Dele Technology”) signed a “Share Transfer Agreement,” intending to transfer a total of 20.33% of shares at 21.88 yuan per share, with a total transaction value of 569 million yuan. After the transaction is completed, Dele Technology will become the controlling shareholder, and the actual controller will change to Chen Zhu. Meanwhile, the company plans to raise an additional 295 million yuan from Dele Technology’s controlling shareholder Nanjing Xingyue Business Management Partnership (Limited Partnership) (hereinafter: Xingyue Business), all for working capital.

Bai Bang Technology, this “phone repair” business that has been providing authorized after-sales service for Apple (AAPL.US) since 2009, with 57 authorized stores nationwide, has been losing money for four consecutive years and urgently needs “blood transfusion.” The acquirer, Dele Technology, founded in 2004, covers mobile phone and smart hardware distribution and retail, supply chain ecological products, etc., and is a true “phone seller.” According to the announcement, Dele Technology’s revenue will reach 5B yuan in 2025, with a net profit of 50.65 million yuan.

Additionally, the announcement states that Dele Technology was once a wholly owned subsidiary of Victory Precision (002426.SZ). In May 2019, Victory Precision launched a strategic transformation, deciding to divest non-core businesses, and sold 100% equity of Dele Technology to Nanjing Dele Business Management Co., Ltd., controlled by Chen Zhu (hereinafter: Dele Business). According to Victory Precision’s May 2020 announcement, the company agreed to transfer 100% equity of Dele Technology to Dele Business and Xingyue Business at a valuation of 1.04B yuan. However, as of the 2025 performance forecast disclosure, the debt related to this transaction has not been fully repaid, and Victory Precision has made provisions for bad debts.

What’s more noteworthy is Dele Technology’s capital background. Equity penetration shows that its second-largest shareholder is Shengshi Investment, one of whose investors is Xintai Life Insurance. Shengshi Investment’s chairman, Jiang Mingming, is a veteran figure in China’s venture capital scene, having led investments in Ctrip (TCOM.US), Spreadtrum Communications, and other projects, with five invested companies successfully listed. Jiang Mingming’s involvement adds a layer of mystery to this capital operation.

In this transaction, the relationship between Dele Technology, the transferor, and Xingyue Business, the subscriber for the private placement, is particularly close. Xingyue Business is not only Dele Technology’s controlling shareholder but also its concerted action partner, both controlled by the same actual controller, Chen Zhu. According to Bai Bang Technology’s detailed equity change report, based on the maximum issuance limit, after this issuance, Dele Technology and its concerted action partner Xingyue Business are expected to hold a total of 43,668,295 shares, accounting for 29.99% of the total shares outstanding after issuance.

Bai Bang Technology stated in the announcement that this equity change is based on the information disclosure obligation holder’s judgment of the company’s value and development prospects, aiming to become the controlling shareholder and, following the principle of sustainable development, optimize management and resource allocation, improve operational conditions, and enhance the company’s value to bring good returns to all shareholders.

On one hand, Xingyue Business injecting 295 million yuan of liquidity through private placement can indeed alleviate Bai Bang Technology’s urgent need, as it has been losing money for four years in a row, with negative operating cash flow (reaching -54.09 million yuan as of September 2025). On the other hand, Dele Technology has explicitly stated that it has no clear plans to change or significantly adjust the company’s main business within the next 12 months, nor any asset injection plans within 36 months.

Furthermore, it is worth noting that whether this transaction can ultimately be realized still faces huge uncertainties. Among the original controlling shareholder Daan Century’s pledged shares, 15 million shares are pledged, accounting for 59.12% of its holdings. According to the transaction process, these pledged shares must be released before the transfer registration can be completed. Given the unclear financial situation of the original shareholder, how to raise funds to解除质押 becomes a critical obstacle. If the pledge cannot be解除, the entire transaction risks falling through.

The “phone repair” business has come together with the “phone selling” business, but the capital market has not shown optimistic expectations. Under multiple pressures—lack of clear profit improvement paths, no new assets injected by new shareholders, and a high proportion of pledged shares by the original shareholder—the market has chosen to vote with their feet. Whether this control change can truly improve Bai Bang Technology’s operations remains to be seen, and investors should rationally consider the balance between short-term fluctuations and long-term value.