On the evening of December 1, Silk Road Vision Technology Co., Ltd. (hereinafter referred to as "Silk Road Vision") issued an announcement that the company held a board meeting on December 1, and after deliberation at the meeting, it was decided to temporarily cancel the transaction of the acquisition of Shenzhen Art Technology.
According to the announcement, Silk Road Vision previously planned to acquire 100% of the shares of Shenzhen Art Technology Co., Ltd., hereinafter referred to as "So Art"), with a transaction price of 90 million yuan, which was intended to be paid in cash, and the funds were first from the company's own funds.
It is understood that then art is committed to developing the new art market, and its business covers the original innovative art touring exhibition, the commercial application of new art, high-quality virtual humans, XR virtual shooting, CG concept short films, AIGC software development, etc. Then Art is one of the outstanding new art curatorial and implementation boutique art teams in China, and its "Mozi" brand enjoys high popularity and reputation in the industry. Based on the optimism about the future development prospects of SO ART and the strong synergy between its business and the existing business of Silk Road Vision, the company decided to acquire SO ART.
As of August 31, 2023, the total assets and net assets of the art are 1462860,000 yuan, 927870,000 yuan, operating income and net profit attributable to the parent company are 2024820,000 yuan, 447750,000 yuan. The third-party asset appraisal agency has evaluated the value of the art enterprise based on the income method and the asset base method, and the value of all the shareholders' equity is 93.09 million yuan and 1904 yuan respectively260,000 yuan.
The difference between the evaluation results of the two methods is mainly due to the difference in the dimensions focused on by the two methods. The asset-based approach considers the reacquisition of assets, which mainly reflects the replacement value of the existing assets of the enterpriseThe income law capitalizes or discounts the expected income, and uses the future profitability of the company's assets as the valuation evaluation.
According to public information, then the art focuses on the planning of cultural and artistic exchange activities, which belongs to the asset-light model, and the enterprise value should include important intangible assets such as service capabilities, talent teams, creative capabilities, and brand advantages in addition to tangible resources such as fixed assets and working capital. At present, there are a total of 102 intangible assets declared by Art, including trademarks, work copyrights, software copyrights, etc. Therefore, the use of the income method can more completely and objectively reflect the corporate value of the art.
It is worth noting that for this acquisition plan, the existing shareholders of Art have made a commitment to the company's future performance. It said that if the equity transfer is completed in 2023, it is promised that the art will achieve a performance of 8.3 million yuan, 10 million yuan, and 12 million yuan respectively from 2023 to 2025. If the equity transfer is completed in 2024, the performance commitment is to achieve net profits of 10 million yuan, 12 million yuan and 13 million yuan respectively from 2024 to 2026. In addition, the acquisition plan also includes terms such as installment payment of the transfer price, performance compensation, and repurchase plan, reflecting the company's optimism about the development prospects.
Based on the above performance commitments, the valuation value of 93.09 million yuan is calculated based on the income method, and the corresponding P/E ratio of the art is 1122 times, 9 in 20243 times. According to public data, the lowest price-earnings ratio of Shenwan's first-class media industry in the past 10 years is 201 times, the lowest P/E ratio of Shenwan's secondary game industry in the past 10 years is 1465 times, which shows that the valuation of Silk Road Vision's proposed acquisition is lower than the lowest level in the secondary market peers in 10 years.
Referring to the comparable transaction cases published in the same industry in recent years, the valuation of Silk Road Vision's acquisition is still relatively low. On May 10, 2018, Fengyuzhu purchased 30% of the equity of Shanghai Liangxiao Information Technology Co., Ltd., and the transaction was 30 million yuan. Liangxiao Technology is mainly engaged in visual communication and digital display of new art, which is similar to the art business, and the net profit of Liangxiao Technology in 2017 was 374930,000 yuan, the acquisition of static P/E ratio of 2667 times. And in 2022, then the art will achieve a net profit of 466250,000 yuan, calculated according to the income method appraisal value, the static P/E ratio is only about 1997 times. It can be seen that compared with the valuation level of comparable cases in the past, the valuation of the target to be acquired by Silk Road Vision this time is not high.