Hygon to Merge with Parent Company Sugon in Landmark RMB116bn Deal
Deal News | Jun 16, 2025 | EIN
In a groundbreaking merger, Hygon is set to acquire its parent company Sugon through a share-swap deal valued at RMB116 billion (USD16.1 billion). This marks a historic transaction as it is the first such subsidiary-to-parent acquisition in China's A-share market and the largest in the AI chip sector. Zhong Lun Law Firm is advising on the deal, with partners Zhang Ming and Tian Yaxiong leading the effort. This merger follows the China Securities and Regulatory Commission's revisions to asset restructuring regulations, facilitating greater merger opportunities. The combined entity's market value is expected to exceed RMB400 billion, with Sugon’s delisting and Hygon assuming all assets, debts, and personnel. The merger is anticipated to consolidate both firms' technological resources, enhancing competitiveness in the tech industry.
Sectors
- Semiconductors
- Mergers & Acquisitions
Geography
- China – The transaction takes place in China, with both companies listed on Chinese stock markets and the deal influenced by Chinese regulatory changes.
Industry
- Semiconductors – The merger involves Hygon and Sugon, both firms in the semiconductor sector, specializing in AI chips and related technologies.
- Mergers & Acquisitions – The article covers a significant M&A deal between Hygon and Sugon, involving complex corporate restructuring.
Financials
- RMB116 billion – The value of the share-swap deal between Hygon and Sugon.
- RMB310 billion – Hygon's current valuation before the merger.
- RMB400 billion – Projected market value of the merged entity.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Hygon | Buyer | Company | A chipmaker focused on core chips like CPU and DCU, listed on the Star Market. |
| Sugon | Seller | Company | A server giant and Hygon's largest shareholder, listed on China's SSE main board. |
| Zhong Lun Law Firm | Legal Advisor | Company | The law firm advising Hygon on the merger, providing due diligence, negotiations, and drafting. |
| Zhang Ming | Lead Partner | Person | Lead partner at Zhong Lun Law Firm advising on the Hygon-Sugon merger. |
| Tian Yaxiong | Partner | Person | Partner at Zhong Lun Law Firm, part of the advisory team for the merger. |
| China Securities and Regulatory Commission | Regulatory Body | Government | Revised the regulations facilitating the merger between Hygon and Sugon. |