(Yicai) June 24 -- Shares of Vantone Neo Development Group plunged by the exchange-imposed daily trading limit after the Chinese real estate developer said it plans to buy a 60.2 percent stake in Source Photonics Holdings (Cayman) Limited, a global developer of optical communication devices.

Vantone [SHA: 600246] was trading down 10 percent at CNY8.88 (USD1.22) as of 1.30 p.m. in Shanghai today, after opening up 6.5 percent.

Vantone will purchase 124 million shares of Source Photonics at USD2.6179 apiece from 12 investors, including Diamond Hill and Shanghai Lucun Enterprise Management Consulting, for a total of USD324 million, the Beijing-based buyer announced yesterday.

The acquisition is a key opportunity for the company to enter the optical module field, Vantone noted, adding that Source Photonics has strong product competitiveness, research and development capabilities, and a long-standing customer reputation and industry influence.

It requires continuous R&D and capital investment to keep up with generational advancements, so leveraging Vantone's operational management capabilities and financial strength will help Source Photonics seize opportunities brought by the increase in demand for artificial intelligence computing power, Vantone pointed out.

Vantone first announced the plan to gain control of Source Photonics in late November last year. On that occasion, the company’s third-largest shareholder GLP Capital voted against the acquisition. The news caused Vantone’s stock to plunge by the 10 percent limit.

On April 12, GLP transferred 5 percent of its shares in Vantone to Hesheng Wealth Fund Management (Beijing) for CNY699 million (USD96.3 million), thus leaving way for Vantone’s acquisition of Source Photonics as the unit of Singaporean logistics warehousing firm was no longer among Vantone’s main shareholders.

Real estate development and property leasing are the primary sources of revenue for Vantone, according to its 2023 earnings report. Last year, Vantone logged an operating revenue of CNY487 million, up 15 percent from the previous year, with real estate sales and property leasing business revenue accounting for 55 percent and 44 percent, respectively, of the total. Net loss widened 20 percent to CNY390 million in the period.

Editor: Futura Costaglione