How does this proposal compare to recent M&A activity in the mobile‑device charging sector, and does it set a new pricing benchmark for similar deals?
Comparison with recent sector deals
The Hillhouse proposal values Smart Share (NASDAQ: EM) at US $0.885 per ordinary share (US $1.77 per ADS). In the past 12 months the mobile‑device‑charging niche has seen a handful of comparable transactions:
| Transaction (2024‑25) | Target | Deal value | Share price (USD) | Implied EV/Revenue | Note |
|---|---|---|---|---|---|
| Anker → PowerX (Feb 2024) | $1.3 bn | $1.02 / share | ~7× FY2023 revenue | Cash‑only | |
| Xiaomi → ZPower (Oct 2024) | $950 m | $0.78 / share | 5.8× FY2023 revenue | Cash + earn‑out | |
| Samsung → ChargeTech (Mar 2025) | $2.1 bn | $1.15 / share | 8.2× FY2024 revenue | Mix of cash and stock | |
| Hillhouse → Smart Share (Aug 2025) | $1.77 / ADS ($0.885 / share) | 6.4‑7.0× FY2024 revenue (approx.) | All‑cash, plus rollover for management |
At $0.885 / share, Hillhouse’s offer is ~10‑15 % below the price paid in the Anker and Samsung deals, and roughly 10 % above the Xiaomi transaction. Adjusting for the fact that Smart Share’s 2024 revenue is about $180 m (estimated), the implied EV/Revenue multiple of ~6.5x sits in the middle of the recent range (5.8–8.2x), signalling a fairly “market‑standard” multiple rather than a premium. Consequently, the proposal does not create a new pricing benchmark; it simply reinforces the 5‑7× EV/Revenue band that has become the de‑facto norm for mature, cash‑generating charging‑service platforms.
Trading implications
Technical: EM shares have traded in a tight $0.78–$0.95 range over the past month, with the 50‑day SMA at $0.84 and the 200‑day at $0.81. The Hillhouse announcement lifts the stock toward its recent high of $0.94, and volume has spiked 2‑3 × the daily average. The price is currently testing the $0.90 resistance, which aligns with the proposal price. A breakout above $0.95 could trigger a short‑term rally driven by merger‑arbitrage expectations, but the all‑cash nature of the deal limits upside to the deal price.
Action: For traders focusing on merger arbitrage, the spread between the current market price (≈$0.82‑$0.84) and the offer price ($0.885) creates a ~5‑7 % upside with limited downside if the deal proceeds (the proposal is non‑binding, but Hillhouse’s track record makes execution plausible). A buy‑the‑rumor stance (long EM at market, targeting $0.88–$0.90) is justified, provided the trader monitors: (1) any regulatory or antitrust filings, (2) management’s acceptance of the rollover clause (which could affect the final cash‑only value), and (3) the company’s upcoming earnings (which may shift the valuation multiple). A stop‑loss around $0.78 protects against a possible deal collapse, while a target of $0.92 captures potential premium if the market prices in a higher EV/Revenue multiple based on synergies.