ZW Knowledge Motion Technologies (CNET) Stock: Why It Surged 37.4%

• The inventory value of ZW Knowledge Action Technologies (CNET) surged by 37.4% in the most modern investing session. This is why.

The stock cost of ZW Knowledge Motion Systems (CNET) surged by 37.4% in the most modern trading session. 

Why: ZW Details Motion Technologies – an built-in on the net advertising and marketing, precision marketing and advertising, facts analytics, and other worth-extra services corporation – introduced that it has signed a letter of intent (LOI), and has formally proposed an acquisition provide to Henan Baodun Data Engineering Co., Ltd (Baodun). 

Pursuant to the LOI, the provide price tag and conditions will be negotiated and decided on completion of thanks diligence, and the completion of the transaction is envisaged in the fourth quarter of 2022. And upon the completion of the acquisition, Baodun will grow to be a wholly-owned subsidiary of the enterprise and will continue being its independency in procedure to give just one-quit eCommerce internet marketing company solutions and full company procedure products and services for shoppers.

What Baodun does: Baodun is a whole-service world-wide-web promoting corporation integrating information internet marketing, marketing impact optimization and brand name advertising and marketing. Baodun has the extensive agency qualification like ByteDance and Kuaishou, and can deliver internet advertising and marketing and marketing assets on several consumer facet solution platforms, such as but not restricted to toutiao.com, ixigua.com, TikTok and Kuaishou. Its main cooperating clients contain SF Categorical, Belle, and Tongrentang. Baodun created roughly $50 million in annualized earnings in 2021 and expects to continue on increasing with a double digit’s growth rate this 12 months.

Intent of the acquisition: The strategic acquisition of Baodun is meant to greatly enhance ZW Data’s competitiveness within the sector and especially in the small video clip system market. The addition of Baodun, together with the Company’s existing experience in advertising and marketing, would appreciably strengthen the Company’s strengths in brief video promotion, merchandising and advertising business enterprise areas, and extend the social eCommerce business to onboard a new progress issue. The company expects that this acquisition will travel a meaningful improve in brief and prolonged-phrase ZW Data’s revenue.

Critical Quote:

“We are psyched to announce this planned acquisition of Baodun. The quick online video current market has expansive advancement prospect, and nowadays, social media platforms such as TikTok and Kuaishou have billions of consumers domestically and internationally. The elite veterans of Baodun are primarily positioned in Zhengzhou, Henan Province and Guangzhou, Guangdong Province. We are extremely thrilled that the founder of Baodun, Ms. Ning Lv, as just one of the most skilled ECommerce operators in China, will be part of the Enterprise with the administration workforce upon the completion of the transaction. The addition of the new team will speed up the improvement of our quick online video merchandising capabilities and strengthen our dedication to building a foremost merchandising organization in China. We consider that this acquisition will travel the diversification of our organization, type a new gain advancement place, and enrich the profitability to bring around and extensive-expression values for shareholders.” 

— Handong Cheng, Chairman and Main Government Officer of ZW Information