1P sub-30-minute fresh-grocery dark stores in 25 Chinese cities — now being sold

• Dark-store grid. ~1,000 micro-warehouses (300-400 sqm) feed a 1-3 km radius; 99% of revenue is direct product sales, only Shanghai/Jiangsu/Zhejiang cluster is profitable.
• Vertically integrated supply. >85% direct procurement from ~1,600 farms; private label is ~20% of GMV (>33% in non-fresh) — the only real margin lever left.
• Closing event reframes everything. Feb 10, 2026 definitive sale of all China ops to Meituan sub Two Hearts for $717M cash; this is now a deal-spread name, not a grocer.

Operating turnaround is real but thin — the only ratio that matters is price-to-pro-forma cash

Revenue grew $1.6B (FY20) to $3.4B (FY25) but growth has decelerated from +30% to +2% YoY. Debt cut 35% in one year; net cash $195M before any deal proceeds land.

Governance grade C+ — a credible operator riding shotgun in a founder-controlled vehicle

• Control gap. Founder Liang holds 26% economics but 69% voting via Class B super-vote (10 votes each); minority Class A holders cannot replace the board or block a related-party deal.
• Leadership handoff. Liang resigned as CEO March 4, 2026; ex-CFO Song Wang (Ele.me / Hema Fresh / Lianhua) promoted; CTO Xu Jiang exited the same day for 'personal reasons.'
• Audit bright spot. Committee chaired by Philip Leung (ex-EY Greater China managing partner); but Liang sits on comp committee and chairs nom/gov — independence is structural-only.
• FPI disclosure gap. No Form 4s required; only annual snapshots — investors cannot detect a quiet sell-down between 20-Fs, and the March 2022 food-safety probe was never named in filings.

Blitzscale to liquidation in five years — operationally clean, equity-narrative discontinuous

Era 1 (2017-2023): Burn, IPO, retreat. Founder Liang pivoted from a baby-care app to dark-store grocery in 2017; COVID lockdowns drove revenue from $1.6B (FY20) to $3.6B (FY22) on $1.6B of cumulative net losses. NYSE IPO at $23.50 in June 2021 collapsed within months; management dated the 'efficiency first' pivot to Q3 2021 and exited Sichuan, Chongqing, Guangzhou and Shenzhen, shrinking revenue 22% in FY23.

Era 2 (2024-2026): Profit, sale, run-off. First GAAP-profitable year in FY24 ($40M on $3.16B); eight straight GAAP-profit quarters; cash net of debt grew for ten consecutive quarters. Then on Feb 10, 2026 the board sold the entire China business to Meituan's Two Hearts for $717M cash and committed to returning at least 90% of post-closing cash to shareholders — turning the equity into a six-to-nine-month closing trade.

What the internet knows that the filings don't say

• Deal upside is up to $997M, not $717M. Feb 10 follow-on disclosed up to $280M of additional pre-closing cash sweep from Dingdong BVI to Cayman by Aug 31, 2026, on top of the headline price.
• Break-fee asymmetry priced regulatory risk. Buyer pays $150M if it walks despite conditions met; $75M if SAMR antitrust clearance fails; DDL pays $75M for cooperation failures — Meituan's risk dwarfs DDL's.
• Five-year non-compete locks the founder. Liang personally signed a five-year non-compete and non-solicit covering Greater China To-C fresh grocery — he cannot launch a competitor through 2031, reinforcing this as a true exit, not a re-cap.

Three closing-side risks dominate; the operating P&L is now noise

• SAMR antitrust review. Meituan already commands ~65% of food-delivery GMV; PRC regulators have actively constrained Meituan since the 2021 Anti-Monopoly Law wave — a Phase II review or remedy could stretch close to mid-2027 and re-introduce the $1.75 deal-break price.
• PRC capital repatriation friction. Every dollar of $717M must move Meituan to PRC opco to Cayman holdco to ADS holder through tax withholding and SAFE approval; FY24 20-F flags that mainland cash may not be available for distributions.
• Distribution mechanics chosen by founder-majority board. 'At least 90%' is policy not contract; vehicle (special dividend vs ADR tender vs buyback) is undisclosed and materially changes per-ADS recovery — and the holder of 69% of votes has 26% of economics.

Calendar is binary — deal close and distribution mechanics, not earnings

• Mid-May 2026. Q1 2026 earnings — only matters if it breaks something that threatens closing; operating metrics are now noise.
• Mid-2026 window. SAMR / MOFCOM antitrust review of Meituan acquiring its fresh-grocery rival — no public timetable disclosed.
• Q3-Q4 2026. Plausible deal close after SAMR clearance and overseas carve-out; outside date Feb 5, 2027 absent extension.
• Post-close (late 2026 / early 2027). Distribution announcement — special dividend, ADR tender, or buyback; this single decision sets per-ADS recovery.