Ningbo Oura Semiconductor Co., Ltd. ("Oura Semiconductor"), which has been active in capital operations in recent years, has seen both its IPO and a previous backdoor listing attempt fail to materialize. A recent restructuring and trading halt announcement by A-listed company 3PEAK Incorporated has brought Oura Semiconductor and its founder Wang Chengdong back into the spotlight, as the listed firm plans to acquire equity in Oura Semiconductor.

After its IPO fell through and a merger with its "sister company" failed, Oura Semiconductor is now seeking acquisition by a peer. For Wang Chengdong, this move may represent a "last resort" in his capital strategy. The question remains: Is this driven by investors' urgent need to exit, or is it Wang Chengdong's only viable option under current circumstances?

**Acquisition by a Peer** What was once a peer mentioned in Oura Semiconductor's IPO prospectus has now become its potential acquirer—3PEAK Incorporated. 3PEAK recently announced a restructuring and trading halt, revealing plans to acquire Oura Semiconductor's equity through issuing shares and/or cash payments while raising supporting funds. The trading halt began on November 26 and is expected to last no more than 10 trading days.

This year has seen numerous cross-industry mergers and acquisitions (M&A) in the semiconductor sector among A-listed companies. The 3PEAK-Oura deal is just one example of this wave. However, Oura Semiconductor's capital history has drawn significant attention to this transaction.

Founded in 2018, Oura Semiconductor specializes in the R&D, design, and sales of analog and mixed-signal chips. Its clock chips, power management chips, and sensor chips have already entered mass production, with clock chips being its flagship product.

Oura Semiconductor grew rapidly, with revenue surpassing CNY 400 million in 2020 and CNY 500 million in 2021. In 2022, Wang Chengdong pushed for a STAR Market IPO, and the prospectus was accepted in November that year. However, the IPO was withdrawn in May 2023, marking its first failure to go public.

After exiting the IPO market, Wang Chengdong explored alternative capital strategies. In August 2023, his listed pharmaceutical company, Shuangcheng Pharmaceutical, proposed acquiring Oura Semiconductor while divesting its medical assets. The deal, involving assets under the same controlling shareholder and targeting the red-hot semiconductor sector, initially boosted Shuangcheng's stock price. However, after nearly seven months of negotiations, the acquisition was terminated in March 2024 due to disagreements over valuation and commercial terms.

Now, eight months later, Oura Semiconductor has found a new suitor in 3PEAK, a fellow chipmaker. Notably, Oura's IPO prospectus had previously cited 3PEAK as an "advanced peer." 3PEAK went public in September 2020 and initially focused on signal chain analog chips before expanding into power management chips in 2018.

On November 26, 3PEAK stated that Oura Semiconductor's expertise in clock and power management chips complements its own product portfolio in signal chain and power management. The merger is expected to enhance 3PEAK's system-level solutions in high-growth sectors like data centers, AI servers, and 5G communications, fostering synergies in R&D, customer resources, and supply chain management.

**Valuation: A Potential Stumbling Block?** While 3PEAK has not disclosed further details, Oura Semiconductor's valuation remains a critical factor, as seen in the failed Shuangcheng deal.

Shuangcheng's acquisition of Oura Semiconductor was initially seen as a natural move, given their shared ownership, but disagreements over valuation derailed the deal. Oura Semiconductor is controlled by Wang Chengdong and his son, WANG YINGPU, who together hold 57.51% of its shares.

3PEAK's preliminary acquisition targets include Hong Kong Aura Investment Co. Limited and several other entities, collectively holding 86.12% of Oura Semiconductor. The final scope of the transaction has yet to be determined.

Oura Semiconductor's valuation remains undisclosed, but its worth was estimated at CNY 10 billion during a May 2021 equity transfer. Financially, Oura reported revenues of approximately CNY 478 million and CNY 472 million in 2022 and 2023, respectively, with net losses of CNY 856 million and CNY 962 million. However, in the first seven months of 2023, it turned a profit of CNY 307 million on revenue of CNY 538 million.

In contrast, 3PEAK posted revenues of CNY 1.094 billion and CNY 1.22 billion in 2023 and 2024, with net losses of CNY 34.71 million and CNY 197 million. For the first three quarters of 2024, its revenue reached CNY 1.531 billion, with a net profit of CNY 126 million.

As of the latest closing, 3PEAK's stock price stood at CNY 148.18 per share, with a market cap of approximately CNY 20.42 billion.

An unnamed investment banker noted that Oura Semiconductor's shift from losses to profitability suggests a stronger market position, which could significantly boost its valuation.

**Wang Chengdong's Strategic Retreat** Compared to an independent IPO, selling Oura Semiconductor to a peer represents a "last resort" for Wang Chengdong.

Wang initially made his fortune in pharmaceuticals, founding Shuangcheng Pharmaceutical in 2000 and leading it to a 2012 A-share listing as a leading peptide drug manufacturer.

Venturing beyond pharma, Wang entered the semiconductor industry in 2010 by co-founding Telink Semiconductor, which he controlled until 2017. His experience with Telink deepened his understanding of the sector, leading to the establishment of Oura Semiconductor in 2018 and its subsequent acquisition of India's Aura Semiconductor.

Post-acquisition, Wang pivoted Oura toward clock chip production, capitalizing on domestic market gaps and downstream demand.

While managing a listed pharmaceutical company and pushing for a semiconductor IPO seemed promising, Oura's withdrawal from the IPO market disrupted Wang's plans.

This year, despite a resurgence in semiconductor IPOs—including second attempts by some firms—Oura opted for a backdoor listing. For Wang, merging Oura into a listed entity was already a compromise, but even this fallback plan failed.

Meanwhile, Shuangcheng Pharmaceutical, Wang's sole listed company, faces delisting risks after reporting 2023 revenue below CNY 300 million and net losses.

Whether due to investor pressure or limited options, Wang has now turned to a peer acquisition for Oura Semiconductor. Further developments regarding this deal and Wang's semiconductor strategy will be closely watched.