Rongqi Technology to buy semiconductor parts maker Deqishun in $84.2M deal
What's the deal? Chinese smart-inspection equipment maker Rongqi Technology (301360) will acquire a 60% stake in Shanghai-based Deqishun Precision Machinery for US$77.2M (about $84.2 million, FX-converted) in cash. After the deal closes, Deqishun will become a controlled subsidiary and join Rongqi's consolidated accounts.
Why now? Rongqi announced the purchase on November 10, days after reporting that net profit for the first three quarters rose more than ninefold year-on-year to US$7.27M. It will fund US$66.8M of the price from leftover IPO proceeds — nearly all of its remaining over-raised capital.
What each side does: Rongqi makes intelligent inspection and precision-assembly equipment for consumer electronics and new energy, including Apple supply-chain customers. Deqishun, founded in 2010, supplies precision polymer and metal parts used in CMP, wet-cleaning, and electroplating tools, and has passed first-article qualification with a leading equipment customer.
What's the endgame? The deal moves Rongqi into upstream semiconductor-equipment components and into chip-tool makers' supply chains. The company said Deqishun's "customer resources and industry experience" can support its push into semiconductor inspection equipment, while adding in-house precision machining it currently buys externally.
The terms: Deqishun's sellers committed to net profit of at least US$4.95M in 2026, US$10.7M in 2027, and US$16.5M in US$278.9M—US$32.2M cumulatively. The valuation implies about 26.7 times Deqishun's 2026 profit pledge, after an income-based appraisal set an enterprise value of US$132M, a 902% premium to book value.
What could go wrong? The promised profits rise sharply across 2026–28 from a 2025 base of US$3.11M, and the steep premium will create goodwill that carries impairment risk if Deqishun falls short.
The signal: The purchase fits a wave of Chinese chip-equipment firms buying domestic suppliers to secure components and widen product lines, alongside deals such as NAURADealroom has a profile for this one. Try Dealroom →'s planned buy of Nuohe Jianwei and PiotechDealroom has a profile for this one. Try Dealroom →'s bid for Wuxi Shangji. With equipment demand strong but component supply constrained, qualified local parts makers have become strategically valuable targets.
Read more: sohu.com
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