Sipai Health Technology Announces Major Acquisition of Leading Medical Insurance Technology Platform

Hong Kong, March 18, 2026 – Sipai Health Technology Co., Ltd. (HKEX: 0314) has announced a significant corporate development after trading hours today, which could have substantial implications for its valuation and future growth trajectory. The company has entered into agreements to acquire 100% equity interest in Jianyi Information Technology (Shanghai) Co., Ltd. (the “Target Company”), a leading commercial health insurance technology and corporate healthcare solution provider in China. This acquisition is structured through the purchase of Shanze Technology, which indirectly owns 98.32% of the Target Company, and the direct acquisition of the remaining 1.68% from Hailin Management.

Key Points of the Acquisition

• Total Consideration: The base acquisition consideration is RMB354.45 million, subject to a price adjustment mechanism and the grant of up to 32 million restricted share units (RSUs) to the Target Company’s CEO, Ms. Cao Baiyan. The maximum consideration, including all RSUs at a value of RMB2.25 each, could reach RMB456.45 million, while the minimum stands at RMB335.70 million. The acquisition of the remaining 1.68% is priced at RMB5.55 million.
• Performance-Linked Payment Structure: Consideration includes four instalments, with up to RMB30 million in performance-based payments over three years. If performance targets are exceeded, additional cash bonuses are payable. If they are not met, payments and RSU grants will be reduced accordingly.
• Retention of Key Management: Ms. Cao Baiyan will remain CEO of the Target Company, will serve as a vice president of the Group, and join the Group’s development committee. Her RSUs are subject to performance and continued employment conditions.
• Completion Conditions: The closing is subject to several customary conditions precedent, including regulatory filings, accuracy of warranties, and no material adverse events. The deal may be terminated under certain conditions, including government prohibition, material breach, or unresolved legal/criminal liabilities of the Target Company.
• Valuation: The RMB430 million valuation was determined by Orient Appraisal Co., Ltd. using a market approach, specifically the EV/EBITDA multiple, benchmarking against leading PRC technology and insurance platform companies.
• Financials of Target Company: As of December 31, 2025, the Target Company reported RMB84.5 million in net assets, RMB227 million in total assets, and net profit after tax of RMB39.64 million for 2025 (up from RMB26.97 million in 2024).
• Strategic Rationale: The Board expects the acquisition to create synergies by merging ecosystem resources, enhancing technology and data-driven capabilities, improving revenue structure, and capturing favorable regulatory and industry trends.
• Funding: The acquisition will be funded by internal resources and commercial bank loans.
• Listing Rules Implications: The transaction constitutes a discloseable transaction (more than 5% but less than 25% in size) under HKEX Listing Rules, requiring notification and public announcement.

Detailed Transaction Structure

Share Purchase Agreement:

• Signed March 18, 2026, between Bixun Pharmaceutical (wholly-owned subsidiary of Sipai Health), the Vendor (Health Pie Limited), Shanze Technology, and the Target Company.
• Base consideration: RMB354,453,690 (inclusive of taxes and duties), subject to a performance-based adjustment mechanism over three years. Instalments and bonuses are tied to after-tax normalized net profits of RMB39.6m (2026), RMB43.56m (2027), and RMB47.92m (2028).
• Bonus/reduction: If performance exceeds targets, Vendor receives a bonus (2.5x the surplus, capped for each year). If not met, instalments are reduced (2.5x the shortfall), with a payment floor.
• RSU Grants: Up to 32 million RSUs (valued at RMB2.25 each for the transaction) to be granted to Ms. Cao Baiyan, vesting over three years, subject to performance and continued employment.
• Escrow Account: Cash payments to be made via escrow, with specific timing linked to completion of government procedures and performance milestones.
• Termination: Either party can terminate for material breach, government prohibition, or if closing conditions are not met within 120 days. Special provisions allow for clawback if the Target Company is adjudicated for a pre-existing corporate crime.

Hailin Share Transfer Agreement:

• Signed March 18, 2026, between Bixun Pharmaceutical and Hailin Management for the remaining 1.68% equity, priced at RMB5,546,310.
• Completion and termination terms mirror those in the Share Purchase Agreement. The agreement is automatically terminated if the main deal fails to complete.

Information on the Target Company

• Established in 2013, the Target Company is a National High-Tech Enterprise and a leader in integrating technology and services for China’s commercial health insurance and corporate healthcare segments.
• It operates a proprietary cloud-based health insurance platform, connecting 200+ insurers and nearly 300,000 medical service points, with real-time claims settlement and AI-driven data processing capabilities.
• It serves 2,000+ large corporate clients and has over 30 patents and certifications (ISO27001, CMMI3), making it a technology leader in the sector.
• Ownership pre-acquisition: Shanze Technology (98.32%), Hailin Management (1.68%).

Valuation Details

• The market approach (EV/EBITDA multiples) was selected as the most appropriate method, reflecting the asset-light, technology-driven business model of the Target Company.
• Comparable companies’ EV/EBITDA multiples ranged from 8.31x to 11.70x; the Target Company’s implied multiple was 9.31x.
• The Board reviewed and accepted the valuation as fair, reasonable, and reflective of market conditions and business prospects.

Strategic and Financial Rationale

• This acquisition aligns with Sipai Health’s long-term development strategy: building an integrated “insurance, healthcare management, medical services, pharmaceuticals” ecosystem.
• Management sees significant post-merger synergies, including expanded market reach, improved cross-selling, enhanced operational efficiency, and an accelerated path to profitability.
• The Target Company’s technology platform is expected to dramatically strengthen Sipai Health’s service delivery, data-driven analytics, and ability to offer personalized health solutions to corporate clients.
• The deal leverages favorable macro trends: rapid growth of China’s insurance industry, deepening integration with healthcare services, and strong policy tailwinds.
• The performance-based structure and retention of key management (Ms. Cao Baiyan) tie a significant portion of the consideration to future results, aligning interests and mitigating risk for Sipai Health shareholders.

Shareholder and Market Implications

• Potential Share Price Impact: This is a significant acquisition for Sipai Health, both in terms of size (up to RMB456 million) and strategic importance. The deal propels the company deeper into the fast-growing corporate health services market, enhances technology and operational capabilities, and is structured to incentivize strong future performance, all of which could be positively received by the market.
• Risks: Completion is subject to regulatory and contractual conditions and may not proceed. A portion of the deal is contingent on future profit performance, introducing some variability in ultimate cost and outcome. There are clawback provisions in case of pre-existing legal issues at the Target Company.
• Governance/Independence: All counterparties are independent third parties, and the deal has been negotiated at arm’s length. The transaction complies with HKEX Listing Rules and is being publicly disclosed as a discloseable transaction.

What Shareholders Should Watch

• Progress toward completion of the deal and satisfaction of conditions precedent.
• Future performance of the Target Company, which will determine the final consideration paid and the actual value delivered to Sipai Health.
• Integration progress and realization of expected synergies in operations, technology, and revenue growth.
• Any adverse developments in regulatory, legal, or operational due diligence that could lead to deal termination, clawbacks, or other significant consequences.

Disclaimer: This article is intended for informational purposes only and does not constitute investment advice. Investors should exercise caution and conduct their own due diligence when considering investments. Completion of the transaction described herein is subject to various conditions and may not proceed as planned. Shareholders and potential investors are advised to monitor further disclosures by Sipai Health Technology Co., Ltd. and consult professional advisors as needed.

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