On July 31st, Gelunhui announced that Capital Realm (00204.HK) signed a Genting agreement with Guoxin Mai to purchase 21.875% equity of Global Mergers and Acquisitions Alliance Limited for HK$70 million on July 31st, 2024. The settlement will be made through the issuance and distribution of Guoxin Mai's price shares. Guoxin Mai's price shares will be issued and distributed at a price of HK$0.47 per share, a discount of about 9.62% compared to the closing price of HK$0.52 per share reported by Lianhe market on the date of the Genting Agreement.
The completion of the acquisition proposal is subject to the approval of the special authorization of the issuance and distribution of Guoxin Mai's price shares passed at the shareholders' extraordinary general meeting.
The target company of Guoxin is a limited company registered in the British Virgin Islands and wholly owned by the affiliates of Guoxin Mai. After the restructuring of Guoxin, the seller of Guoxin Mai will hold 100% equity of the target company of Guoxin, while the target company of Guoxin will indirectly hold 32% equity of Guoxin's operating company through its wholly-owned subsidiary. The main business of the target company of Guoxin and its subsidiaries is investment and holding.
Guoxin's operating company and its subsidiaries mainly provide online platform and digital services in mainland China. Its main businesses include (i) providing automation digital services for major participants in new economic industries such as food delivery companies to settle worker salaries and commissions; (ii) providing online platforms and digital solutions, promoting the leasing of light construction equipment by providing matching services, rental information, contract documents, and compliance materials to landlords and tenants; (iii) providing online platforms for small and medium-sized enterprises to mediate disputes, including providing mediators and communicating with people's courts at all levels in China; and (iv) providing digital solutions for corporate finance management, tax declaration, bookkeeping, etc.
Guoxin's operating company and its subsidiaries provide online platform and digital services for new economic industries, construction industry and enterprises in mainland China. China's digital economy is growing rapidly. Therefore, the directors believe that the acquisition proposal has significant growth potential. The purpose of the acquisition proposal is to achieve medium- to long-term capital appreciation.