Thanks for reading. Short version: Q&M is proposing to sell most of its dental-AI arm, EM2AI, to small-cap Medi Lifestyle for ~S$6.76m in shares, not cash. The deal implies only ~S$11.3m for all of EM2AI, a little over 2% of Q&M’s value, so it barely moves the company.
The buyer is also financially stretched, with auditors having flagged going-concern uncertainty. Neither a win nor a disaster, and still only a preliminary agreement.
We’re finishing our Coverage Updates for Q&M with the numbers and charts - coming up soon.
I find it interesting that Q & M Dental Group (Singapore) Limited (QC7; QNM SP) recognised SGD 15 mn gain on bargain purchase from its acquisition of Aoxin Q & M Dental Group Limited (1D4; AOXIN SP).
Good catch. The S$15M gain on bargain purchase arises because Q&M acquired Aoxin at a price below its net asset value - the market had been discounting Aoxin heavily for its years of losses and legacy profit guarantee shortfalls, so the acquisition price came in below the fair value of the underlying assets. It's non-cash and non-recurring, which is why we stripped it out when looking at core dental earnings. But we should have flagged it explicitly rather than folding it into "consolidation one-offs." Appreciate you pointing that out.
Please comment on the sale of 60% of EM2.AI by Q & M to Medi Lifestyle.
Thanks for reading. Short version: Q&M is proposing to sell most of its dental-AI arm, EM2AI, to small-cap Medi Lifestyle for ~S$6.76m in shares, not cash. The deal implies only ~S$11.3m for all of EM2AI, a little over 2% of Q&M’s value, so it barely moves the company.
The buyer is also financially stretched, with auditors having flagged going-concern uncertainty. Neither a win nor a disaster, and still only a preliminary agreement.
We’re finishing our Coverage Updates for Q&M with the numbers and charts - coming up soon.
Here you go
https://www.theseaanalyst.com/p/q-and-m-dental-sgx-qc7-1h2026-share-price
Stay tuned.
The SEA Analyst,
I find it interesting that Q & M Dental Group (Singapore) Limited (QC7; QNM SP) recognised SGD 15 mn gain on bargain purchase from its acquisition of Aoxin Q & M Dental Group Limited (1D4; AOXIN SP).
Good catch. The S$15M gain on bargain purchase arises because Q&M acquired Aoxin at a price below its net asset value - the market had been discounting Aoxin heavily for its years of losses and legacy profit guarantee shortfalls, so the acquisition price came in below the fair value of the underlying assets. It's non-cash and non-recurring, which is why we stripped it out when looking at core dental earnings. But we should have flagged it explicitly rather than folding it into "consolidation one-offs." Appreciate you pointing that out.