Gongjin to shed loss-making unit at $7M floor after Tangshan state takeover
What's the deal? Shenzhen-listed Gongjin Electronics plans to sell its wholly-owned subsidiary Shandong Wenyuan Communication Technology via a public listing on the Shenzhen United Property and Equity Exchange, at a floor price of US$6.9M. The move follows Tangshan Industrial Holdings taking control of Gongjin earlier in 2026.
What each company does: Gongjin makes networking and data-centre products. Shandong Wenyuan builds 4G/5G public-security equipment, network data visualisation, and smart-community and safe-city systems — a business Gongjin bought in 2018.
Why now? Demand in the public-security communications market has weakened since 2022, leaving Wenyuan loss-making. Gongjin says the sale will sharpen its focus on core operations, streamline assets, and cut running costs.
The numbers: Wenyuan's equity carries a book value of US$6.01M and an appraised value of US$6.84M. The US$6.9M floor sits far below the roughly US$96.3M Gongjin paid in 2018, though much of the resulting goodwill had already been written off. The listing window runs through December 7.
What's the endgame? Gongjin is pivoting toward networking and data-centre gear. Revenue rose 22.9% and net profit 30.4% in the first three quarters of 2026, while its data-communications arm grew sharply in the first half.
What could go wrong? No buyer has emerged, and the final price and terms depend on the listing outcome. The exit could still fail or clear below the floor, and the disposal's financial benefit remains uncertain.
The signal: The sale caps a reset under new state ownership, with Tangshan's municipal state-asset regulator now the ultimate controller. It marks a focused cleanup — trimming a weak legacy unit to concentrate on faster-growing networking and data-centre lines.
Read more: minichart.com.sg
Image credit: "Supercomputing" by Idaho National Laboratory, licensed under CC BY 2.0 (https://creativecommons.org/licenses/by/2.0/), via https://www.flickr.com/photos/30369883@N03/6236052094
