SMIT (02239)'s subsidiary S2C Shanghai injected into Wuxi Yake Hongyu Electronics through a share swap to jointly build an integrated EDA platform

SMIT (02239) announced that on October 13, 2026, Wuxi Yake Hongyu Electronics Co., Ltd. (the Target Company), the S2C subscribers (including S2C Holding), the major shareholders of the Target Company, and other subscribers entered into an agreement, pursuant to which (i) the S2C subscribers have conditionally agreed to subscribe, and the Target Company has conditionally agreed to issue, the S2C target capital, at a consideration of approximately RMB 1,223.1 million, to be paid by each injecting part of the S2C exchange capital held by them into the Target Company, together accounting for approximately 86.35% of the equity interest in S2C Shanghai; and (ii) the other subscribers have conditionally agreed to subscribe for a total registered capital of approximately RMB 22,834,600 in the Target Company at a consideration of approximately RMB 518 million. This includes S2C Holding's intention to inject its approximately 13.75% equity interest in S2C Shanghai (i.e., the relevant S2C capital) into the Target Company as consideration for subscribing to the registered capital of RMB 8,582,990 in the Target Company (i.e., the relevant target capital), representing approximately 10.12% of the equity interest in the Target Company immediately after the completion of the share swap and approximately 7.98% of the equity interest in the Target Company immediately after the completion of the capital injection. As at the date of this announcement, S2C Holding holds 13.75% of the equity interest in S2C Shanghai, while the other S2C subscribers collectively hold 72.60% of the equity interest in S2C Shanghai. As at the date of this announcement, the Company holds approximately 97.50% of the equity interest in S2C Holding. The S2C Shanghai Group is a supplier of EDA and rapid verification solutions. The Target Group is a globally leading supplier of FPGA prototyping and emulation tools and solutions, focusing on the field of innovative SoC/ASIC design. The announcement stated that the transaction will integrate the resources and capabilities of the S2C Shanghai Group and the Target Company to create a more comprehensive and competitive EDA platform with a better product portfolio. The combined entity is expected to benefit from synergies in technology development, supply chain management, and market expansion. In addition, the combined entity will have an expanded shareholder base covering reputable investment funds and strategic investors, and will therefore possess stronger financial resources to support future growth plans and R&D efforts in the rapidly evolving semiconductor verification tools market. The transaction provides an excellent investment opportunity for the Group, enabling it to join hands with other established leading investors and renowned enterprises in the semiconductor industry to jointly participate in the growth prospects of the Target Company's new EDA business platform.