Youlife Group Inc. Announces Non-Binding Letter of Intent as It explores Strategic Expansion in China's Blue-Collar Service Market

Rhea-AI Summary

Youlife Group (NASDAQ: YOUL) on December 12, 2025 announced a non-binding letter of intent to pursue a proposed pure-equity acquisition of four regional human resources service companies in China. The contemplated deal would first consolidate the targets under an offshore holding structure and may involve newly issued Youlife shares with performance-based mechanisms to align incentives and preserve cash.

The targets operate in job placement, flexible staffing, and workforce management across multiple provinces, serving logistics and livestock farming clients. The LOI is non-binding, subject to due diligence, valuation, negotiation, and definitive agreements, and there is no guarantee the transaction will occur on current terms or timeline.

Key Figures

Target companies 4 companies Regional HR service firms under the proposed LOI acquisition

Market Reality Check

$2.11 Last Close

Volume Volume 382,607 is 3.22x the 20-day average of 118,847, signaling elevated interest ahead of potential M&A. high

Technical Shares trade above the 200-day MA, with price at 2.11 versus MA(200) at 1.94, reflecting a pre-news uptrend.

Peers on Argus 1 Down

YOUL gained 6.03% while peers showed mixed moves: SKIL up 13.51%, VSA up 23.7% but later flagged in momentum scanner moving down 10.28%, and IH down 7.36%. With only one peer in the momentum scanner and no common news, today’s move appears stock-specific.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Dec 01	Board changes	Neutral	+0.6%	Board and CFO appointments with two director resignations effective November 21.
Sep 10	Investor event	Neutral	-24.2%	Announcement of a virtual investor event and management presentations.
Sep 09	Earnings update	Positive	+24.4%	Strong H1 revenue and profit growth plus planned acquisitions and a JV.
Aug 29	Strategic joint venture	Positive	+0.0%	Joint venture with Galbot to build robotics-focused vocational education platform.

Pattern Detected

Stock reactions have been strongest on fundamental updates: earnings news saw a sharp gain, while neutral events like an investor day triggered a large selloff, indicating sensitivity to perceived execution risk and capital allocation messaging.

Recent Company History

Over the last few months, Youlife has focused on governance, growth, and strategic positioning. On Aug 29, 2025, it formed a joint venture to advance intelligent vocational education, with minimal price reaction. Strong H1 2025 results on Sep 9 and announced acquisition plans drove a 24.43% gain. A virtual investor event announcement on Sep 10 coincided with a -24.2% drop, while November’s board and management changes produced only a modest 0.62% move. Today’s LOI ties back to the previously flagged acquisition strategy.

Market Pulse Summary

This announcement outlines a non-binding LOI for Youlife to acquire four regional HR firms via an equity-based structure, advancing a shift from purely organic growth to strategic M&A. It builds on earlier plans disclosed with H1 2025 results and could expand geographic reach and operational synergies if completed. Key watchpoints include completion of due diligence, final transaction terms, performance-linked share mechanisms, and how the deal might affect capital structure and integration execution.

Key Terms

non-binding letter of intent financial

"today announced that it has entered into a non-binding letter of intent (the "LOI")"

A non-binding letter of intent is a preliminary document that outlines the main terms and expectations of a proposed transaction—such as a merger, acquisition, investment or partnership—without creating a legally enforceable obligation to complete the deal. Think of it as a written handshake or shopping list: it signals serious interest and sets the framework for negotiations and due diligence, which can move markets, but it does not guarantee the transaction will happen until a final, binding agreement is signed.

due diligence financial

"subject to further evaluation, due diligence, valuation, and negotiation"

Due diligence is the careful investigation and analysis someone conducts before making a decision, such as investing money or entering into an agreement. It’s like researching thoroughly before buying a used car to ensure it’s in good condition; this helps prevent surprises and makes informed choices. For investors, due diligence reduces risk by verifying details and understanding what they’re getting into.

AI-generated analysis. Not financial advice.

BEIJING, Dec. 12, 2025 /PRNewswire/ -- Youlife Group Inc. ("Youlife" or the "Company") (NASDAQ: YOUL), a leading blue-collar lifetime service provider in China, today announced that it has entered into a non-binding letter of intent (the "LOI"), expressing its intention to acquire four regional human resources service companies (the "Target Companies") through a proposed pure-equity transaction. The LOI represents a major step in the Youlife's evolution from pure organic growth to a dual-engine strategy combining organic expansion and strategic M&A.

Under the non-binding LOI, Youlife and the sellers intend to undertake an internal restructuring to consolidate the Target Companies under an offshore holding structure. Upon completion of this restructuring, Youlife may consider acquiring the holding entity through an equity-based transaction involving newly issued shares of Youlife, subject to further evaluation, due diligence, valuation, and negotiation and execution of definitive agreements.

The contemplated structure is designed to preserve cash resources while aligning long-term interests between both parties. Any potential share consideration is expected to include performance-based mechanisms that would help safeguard shareholder value and ensure ongoing alignment. All terms remain under discussion, and the LOI does not obligate either party to proceed unless and until definitive agreements are executed.

The Target Companies have long-standing operations in job placement, flexible staffing, and regional workforce management across multiple provinces in China. They have strong presence in labor-intensive verticals such as logistics and livestock farming, serving key clients include market-leading enterprises. The intended acquisition will reinforce Youlife's full-cycle blue-collar service ecosystem, which spans vocational education, recruitment, and employee management. If completed, the acquisition is expected to broaden Youlife's geographic reach, enhance network density, and create opportunities for future operational synergies.

Mr. Yunlei Wang, Chief Executive Officer and Chairman of the Board of Youlife, emphasized, "This LOI represents a meaningful step in our commitment to integrating regional strengths into a unified, high-quality, nationwide blue-collar service platform. China's blue-collar human resources sector is undergoing significant transformation, driven by industrial upgrading, rising compliance requirements, and the rapid adoption of digital and AI-enabled workforce solutions. These trends are creating new opportunities for consolidation and platform-driven models.

Upon completion, we believe the Target Companies' regional expertise, combined with Youlife's nationwide ecosystem and our AI-powered 'DeepBlue Brain' matching engine, could enhance our ability to deliver standardized, efficient, and technology-driven workforce solutions across the country. This is a meaningful step forward in strengthening Youlife's long-term development path and leadership position in China's blue-collar service market."

Ms. Liqun Yao, acting Chief Financial Officer of Youlife, added, "The non-binding LOI reflects our disciplined approach to evaluating strategic opportunities. By using an equity-based structure tied to the future performance of the acquired businesses, we would be able to preserve cash, maintain financial flexibility, and align incentives with long-term shareholder value."

The Company has not entered into definitive transaction agreements with the sellers, and the execution of any definitive agreements is contingent upon the commercial negotiations with the sellers and the completion of the relevant legal and financial due diligence. There is no guarantee that the contemplated transactions will take place under the current terms or timeline, or at all. Shareholders are cautioned not to place undue reliance on this preliminary announcement.

About Youlife Group Inc.

Youlife is a leading blue-collar lifetime service provider with a nationwide network of 25 vocational schools under school management model and 25 curriculum development projects, covering a total of 37 cities or counties under 16 provinces of China. Learn more at https://ir.youlife.cn/.

Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "estimate," "plan," "project," "forecast," "intend," "will," "expect," "anticipate," "believe," "seek," "target" or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements also include, but are not limited to, statements regarding future events and the future results of Youlife current expectations, estimates, forecasts, and projections about the industry in which Youlife operates, as well as the beliefs and assumptions of Youlife's management. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of Youlife's management and are not predictions of actual performance. These statements involve risks, uncertainties and other factors that may cause Youlife's actual results, levels of activity, performance, or achievements to be materially different from those expressed or implied by these forward-looking statements.

Contact 
Sufang Fu
youlife.ir@youlanw.com
(86) 18280935910

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SOURCE Youlife Group Inc

FAQ

What did Youlife (YOUL) announce on December 12, 2025 regarding acquisitions?

Youlife announced a non-binding LOI to pursue a proposed pure-equity acquisition of four regional HR service companies in China.

Will Youlife (YOUL) pay cash for the four regional HR companies?

No—Youlife said the contemplated transaction would be equity-based, potentially using newly issued Youlife shares with performance-based mechanisms.

What business areas do the targeted companies cover in Youlife's proposed deal (YOUL)?

The targets operate in job placement, flexible staffing, and regional workforce management across multiple Chinese provinces.

Does the LOI mean Youlife (YOUL) has completed the acquisition?

No—the LOI is non-binding and the acquisition is subject to due diligence, valuation, negotiation, and execution of definitive agreements.

How could the proposed acquisitions affect Youlife's (YOUL) operations?

If completed, Youlife expects broader geographic reach, higher network density, and potential operational synergies across its blue-collar service ecosystem.

What risks did Youlife (YOUL) disclose about the proposed transaction?

Youlife cautioned there is no guarantee the transaction will occur on current terms or timeline and investors should not place undue reliance on the preliminary announcement.