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Aokang International, historically known as the "Shoe King," has announced its intention to diversify into the storage chip industry by acquiring United Memory Technology (Jiangsu) Ltd. The company has suspended trading as of December 24th and anticipates a trading halt not exceeding 10 trading days.

United Memory Technology, established in November 2021 with a registered capital of 18.18 million yuan, specializes in storage chips and has achieved the development of fully indigenous, self-researched storage chips. Their product lineup includes embedded storage chips such as PPI Nand, SPI Nand, DRAM, LPDDR, and MCP, which are utilized across various sectors including network communication, wearables, industrial control, medical devices, and IoT.

Aokang International, listed on the A-share market in 2012, has been grappling with a downturn in its core shoe business. The company's revenues for the first three quarters of this year were approximately 1.888 billion yuan, a decrease of 18.8% year-on-year, with a net loss of about 136 million yuan, marking an increase of 50.56% in losses compared to the same period last year.

The decline in Aokang's performance mirrors the shrinking leather shoe market, with domestic annual production falling from 4.618 billion pairs in 2016 to 3.524 billion pairs in 2021, with projections for further reduction.

In response to these challenges, Aokang has been investing in other sectors, in search of growth outside its traditional footwear business. However, these ventures have not yet significantly improved the company's financial performance.

As of the close on December 23rd, Aokang International's shares were trading at 7.08 yuan, down by 0.98%.

Aokang stated that this acquisition is not expected to result in a significant asset restructuring, constitute a related-party transaction, or lead to a change in the company's actual control. The transaction details are still under discussion and subject to uncertainty. Investors are advised to exercise caution.