Our client is a large global investment firm, acting as the Promoter of the SPAC. They are looking to list one of the first SPACs in Hong Kong.
The timeline was to have the SPAC listed by the end of January 2022. One month after the release of the listing regime in Hong Kong.
As a pioneer in the new listing process in Hong Kong, there were few precedence to reference, thus all professional parties had to work closely with each other, and hold many discussions internally and externally (with HKEX’s IPO vetting department, other big-4 accounting firms) to confirm the correct approach.
As the Issuer’s outsourced finance function, we referenced our knowledge in the US SPAC deals and applied such knowledge in the HK SPAC listing. We worked closely with a Big-4 accounting firm to prepare the financial statements & Accountants Report and the Pro-Forma Net Assets/Liabilities statement; we worked closely with the valuation firm and Big-4 valuation team on the valuation approach and methodology in valuing the financial instruments (such as Promoter & Listed Warrants and Shares); we also worked closely with the Sponsors and Promoters to prepare the Working Capital Forecast Memo.
We’ve met the deadline for filing, and helped the client to become one of the first SPACs to have filed the Application Proof (A-1) in Hong Kong. We expect the actual listing to completed in the first half of 2022.
Project ESOP is a company with operations based in China, planning to be publicly listed. It current has an employee share option plan (“ESOP”), and the employees are able to exercise their share options after the company is listed.
Employees who exercise their options are expected to have a substantial amount of capital gain at exercise date, which is taxable by tax authorities at a individual tax rate of 20-45%.
Thus companies will normally plan for the employees to realise a portion of the gain through transferring the share options into a Trust, where the Trust will be subject to a lower corporate tax rate of 20%.
Project ESOP successfully restructured its ESOPs into a Trust and saved tax for its staff.
Project Influence is engaged in helping non-China brands sell within China. Its core business includes adopting AI to develop a great marketing and eCommerce solution for its clients. It has many years of in-market experience and provides services to over 550 brands across mainland China, Hong Kong and USA.
Project Influence has solicited acquisition interest from a listed company, but the organisational structure is scattered with various individuals holding various entities in mainland China, Hong Kong and USA. Project Influence requires a re-organization of these entities under one holding company to enable shareholders to be able to sell the group, efficiently manage its entities, and have a consolidated view of its financial results.
Since Project Influence is in the media industry in China, the re-organisation plan needs to consider the Internet Content Provider (ICP) license being held under a Chinese local company.
Project Influence has re-organised into a structure that is compliant to local laws, and is ready to be acquired. It’s financial information compliant is also prepared to be compliant to international standards.
As such, Project Influence has received a term sheet from the listed company potential buyer with the consideration of more than 2 times of the valuation before the re-organisation (from ~USD30m to ~USD80m).
Project Queen offers ready to cook and ready to eat meals and food products under its brand. It’s operations are conducted primarily in China.
Project Queen sought to raise funds through an IPO in the U.S., merging with a special purpose acquisition company (SPAC) to unlock further strategic expansion opportunities. Due to different reporting and regulatory standard in the U.S., they require a finance team to co-ordinate with different involving parties for all rounded financial compliance with US regulatory and reporting standards.
The proposed merger was filed with the US regulators, where Project Queen will be listed in the Nasdaq Capital Market post-merger.
Project Lab is a genetic and diagnostic health testing company direct to consumers, where its products help to identify health risks with the use of a DNA sequencing technology.
Our UK based VC fund partner was looking to invest in the Series C round, where the company is valued at approximately USD 140million.
We were engaged to perform a Financial Due Diligence on the target company before the VC fund pulls the trigger on the investment.
We supported the VC Fund to perform a Financial Due Diligence to assess the business risks of the target company via understanding of the major business processes.
1. New investments or business lines of the group
2. Revenue
3. Direct Costs
4. Operating expenses
The deal was successfully completed. The VC Firm invested into the Target due to its growth potential, and this turned out to be an investment that flipped 10 times its value up to date.
The VC Firm appreciated our knowledge in both HK and China companies, and the ability to perform high quality review on financials tied with operation results, within a short period of 5 days.
Project BOT is an artificial intelligence consultancy firm offering tailored A.I. development and data annotation applications ranging from automating social monitoring service to delivering algorithms of personalized wealth management services.
Similar to difficulties faced by most of the start-up companies with creative ideas and great growth potential, Project BOT requires financial figures, historical and projected, that meet compliance standards when they seek for funds from an angel investor, and a valuation of how much the company is worth.
Project BOT successfully raised USD600,000 from the angel investor.
Project Endurance, an industry leader in Electric Vehicle Charging business, has business operations in both mainland China and Hong Kong.
Since the business operation of different departments is disaggregated, the entity faced a significant challenge in gathering scattered information from various reporting units to amalgamate into an organized set of financial statements. Our goal was to prepare a set of management accounts that met the auditor’s requirement, and work with the auditors to carry out audit procedures and issue an auditor’s report.
Completed series D round of equity funding with the support of financial figures in auditors’ report issued by a Big-4 accounting firm.
