A "familiar transaction": what is Aibo Medical betting on?

Why keep buying and buying.

Cai Jun, Investor Network

Recently, Aibo Medical (688050.SH, hereafter “the company”) has made another acquisition.

This is the company’s fourth capital operation since 2020. Earlier, the company entered the consumer medical track through two acquisitions and strengthened its capital base via private placements to expand production.

However, the results have been disappointing; the assets acquired previously did not meet expectations and instead put pressure on performance and valuation. Will this new deal follow the previous path, or will it break through the current company’s various anxieties? Everything remains uncertain.

“Familiar Deals”

According to the announcement, the company plans to acquire 68.31% of Demei Medical using merger loans and its own funds, with a transaction price of 683 million yuan. The target is a leading domestic sports medicine company, covering sports medicine implants, surgical tools, arthroscopy equipment, sports rehabilitation devices, and more.

On the surface, this deal is the largest cross-industry acquisition since the company’s listing. But at its core, this is not a random strategic move; it is led by a “familiar” capital operation connected to the company’s pre-listing capital history, the volatile valuation changes of Demei Medical, and the company’s two failed attempts to enter consumer healthcare.

Among the 17 counterparties in the deal, one includes Ginkgo Boqing, controlled by former director Chen Lei. This entity holds over 6% of Demei Medical’s shares, with a transaction value exceeding 30 million yuan. In fact, Chen Lei’s “mutual pursuit” with the company began before listing, when he led the company’s Series A and D financing rounds, becoming a core financial ally in the company’s transition from startup to IPO.

From 2019 to 2022, Chen Lei served as a director and became a key member. His capital group not only provided funding but also connected academic resources, clinical channels, and policy resources, helping the company break the import monopoly on artificial lenses. Meanwhile, the company successfully listed on the STAR Market, realizing a leap in capital value.

Therefore, the valuation of this deal has become a point of interest in the “familiar deal.” According to the plan, Demei Medical’s overall valuation is about 1 billion yuan. This has led to two very different market opinions.

One side believes that the company’s acquisition involves a high premium. The target’s net assets exceed 200 million yuan, and by this calculation, the valuation increase exceeds 300%. Additionally, the target’s adjusted net profit for 2025 is 23.6 million yuan, and based on static PE valuation, it exceeds 40 times, higher than the company’s own approximately 33 times.

The other side argues that the current price is significantly lower than the 2021 Series E round valuation. At that time, platforms under Chen Lei, such as Qiming Venture Partners and Dingsheng Capital, participated in financing, with a post-investment valuation of about 1.5 billion yuan. In fact, during the Series D financing in 2020, the target’s post-investment valuation was about 800 million to 1 billion yuan, with Hillhouse Capital also involved.

From this perspective, the current transaction price for investors after Series D does not offer obvious arbitrage opportunities. However, it should be noted that in 2016, Chen Lei’s Qingkong Ginkgo participated in Demei Medical’s initial funding round, potentially yielding higher profits than Qiming Venture Partners, Dingsheng Capital, or Hillhouse Capital. Also, this acquisition has not been recognized as related-party transaction.

In response, Investor Network contacted the company to clarify whether this involved related-party transactions. The company replied that everything is conducted in accordance with the Securities Law, and the plan and procedures are reasonable and compliant.

Double Pressure on Performance and Valuation

Aibo Medical’s core capital operation logic is to reconstruct growth trajectories through acquisitions amid pressure on core business and sector shifts, thereby switching valuation models based on new sectors.

In 2021 and 2023, the company successively acquired Tianyan Medical and You Ni Kang Optical, both focusing on colored contact lenses. The core logic at the time was to quickly enter the hundreds-of-billion consumer healthcare market before its artificial lens and corneal reshaping businesses were deeply entrenched in red ocean competition, using capital to “create miracles” and forge new growth curves.

Moreover, by 2025, the company raised 285 million yuan through private placement at 79.2 yuan per share, mainly for the construction of contact lens production lines and to supplement working capital. It is evident that with continuous capital reinforcement, the company is betting on consumer healthcare with a long-term perspective.

However, this bet has not yielded the expected results. According to the performance brief, the company expects revenue of 1.483 billion yuan in 2025, up 5.15% year-over-year; net profit attributable to shareholders of the listed company is 265 million yuan, down 31.67%. Among these, revenue from contact lenses (including colored lenses) increased by 7.53%, but fierce price competition on e-commerce platforms led to profit declines.

More importantly, the brief mentions that the company has recognized an asset impairment loss of 86.69 million yuan, mainly related to goodwill and some fixed assets in the contact lens business. In other words, the company’s focus on consumer healthcare is beginning to become a burden.

On the surface, Tianyan Medical and You Ni Kang Optical each have mature online channels and large-scale production lines. The company’s acquisition path aims to build a complete “R&D + manufacturing + sales” chain, gradually shifting valuation models from the red ocean of centralized procurement to consumer healthcare. Previously, OptoK Vision, a leader in ophthalmology focusing on myopia prevention for teenagers, had a market value exceeding 80 billion yuan. In comparison, the company’s peak market value was over 40 billion yuan.

However, after heavily entering the consumer healthcare sector, the company has not achieved the explosive growth expected. On one hand, the acquired assets focus on “brand marketing + online channels,” while the company’s core capabilities are in “medical consumables R&D + clinical channel promotion,” with fundamentally mismatched logic.

On the other hand, post-acquisition, the company has failed to establish effective synergy, leading to separate operations in R&D, channels, and supply chains. In terms of products, leading brands like Johnson & Johnson and Hysan continue to iterate new products, but the company lacks high barriers to core competitiveness, falling into price wars. In marketing, online promotion of colored lenses requires continuous ad spend, incurring high costs for traffic.

These factors create a double-edged situation. On the positive side, revenue from the contact lens business is growing and maintaining momentum. On the negative side, profits are being eroded, and goodwill impairments are pressuring performance.

Regardless, the capital market reflects the company’s performance. As of now, the stock price is about 60 yuan per share. In 2025, institutions participating in the company’s private placement include Bosera Fund, Caitong Fund, Nord Fund, J.P. Morgan, ICBC Credit Suisse, Yongying Fund, E Fund, and others. Based on this, these institutions may be at a loss.

Therefore, concerns about this new acquisition are understandable. According to the announcement, over half of the funds are relying on merger loans, and after completion, the company is expected to have over 500 million yuan in goodwill. Furthermore, if the target’s performance does not meet expectations, goodwill impairment could directly impact the company’s profits.

Although the company states that there is synergy in R&D and registration of high-value medical consumables, their marketing systems and academic promotion models are quite different. The company’s sales network mainly targets ophthalmology hospitals and vision centers, while Demei Medical primarily serves orthopedic, sports medicine doctors, and rehabilitation institutions.

Ultimately, the company recognizes the ceiling of its existing products and is attempting to shift to high-valuation sectors through capital operations. However, during integration, various factors have led to pressure on both performance and valuation. Whether the new deal can break past the previous integration challenges remains to be seen. (Produced by Siwei Finance)■