China Oral Industry Group  Holdings Limited Plans to Acquire Upstream Knitted Fabric Supplier for HKD 21.6 Million

Image Source: China Dental Industry Group Holdings Limited Announceable Transaction

DentalGoodNews | On March 16, 2026, China Dental Industry Group Holdings Limited (hereinafter referred to as "China Dental Industry Group") announced that its indirect wholly-owned subsidiary, Shishi Huixiangmei Management Consulting Co., Ltd., has entered into an agreement with an independent third party to acquire the entire registered share capital of Shishi Xinsuo Chenglong Knitting Co., Ltd. (hereinafter referred to as the "Target Company") for a consideration of HK$21.6 million (approximately RMB 19.18 million). The consideration will be satisfied in full by the issue of consideration shares.

A total of 273,417,722 consideration shares will be issued at an issue price of HK$0.079 per share (approximately RMB 0.07), representing a premium of approximately 17.91% over the closing price of HK$0.067 per share (approximately RMB 0.059) on the date of the agreement (March 16, 2026), and a premium of approximately 23.82% over the average closing price of approximately HK$0.0638 per share (approximately RMB 0.057) for the five consecutive trading days preceding that date. The consideration shares are to be issued within 20 business days after the transfer of the management rights of the Target Company. The issuance does not require shareholders' approval and falls within the scope of the general mandate.

The Target Company, Shishi Xinsuo Chenglong Knitting Co., Ltd., is a textile manufacturing enterprise focusing on the R&D, production, and sales of knitted fabrics. It holds several patent technologies related to knitted fabric processing, with its main customers being in the fields of garment manufacturing and textile trading. According to unaudited financial information, the Target Company's profit after tax for the year 2025 was approximately RMB 2.275 million, with net assets of approximately RMB 22.68 million. For the year 2024, its profit after tax was approximately RMB 1.597 million.

The valuation was prepared by the independent professional valuer, Navarre Valuation Advisory Limited, using the market approach. Based on the median EV/EBITDA multiple of 8.01x for comparable listed companies, and after applying a 20.4% discount for lack of marketability and a 30.2% control premium, the valuation of 100% equity interest in the Target Company is approximately RMB 21.68 million. The acquisition consideration of HK$21.6 million (approximately RMB 19.18 million) was determined through fair negotiation between the buyer and the seller.

China Dental Industry Group stated in the announcement that the Target Company's business constitutes part of the Group's upstream supply chain. The acquisition aims to strengthen supply chain stability and enhance the Group's overall cost control capabilities in business operations. The Group's existing businesses cover multiple segments including the manufacture and sale of inflatable products and related accessories, the provision of dental services and sale of dental-related products, and the sale of yarn and polyester. The acquisition is conditional upon, among other things, the approval for the listing of, and permission to deal in, the consideration shares by The Stock Exchange of Hong Kong Limited, compliance with the laws and regulatory requirements of the relevant jurisdictions, and the fulfillment of such conditions on or before June 30, 2026, failing which the agreement will lapse.

According to a previous report by DGN, in January 2026, China Dental Industry Group signed a Memorandum of Understanding with Taiwan-based Bo Hui Biotechnology Co., Ltd., planning to establish a joint venture in the Greater Bay Area to promote hospital clinical treatment business.