MingZhu Logistics Reports a Share Purchase Agreement to Acquire CheYi Network
Dec 29, 2021 By MarketDepth
MingZhu Logistics Holdings Limited (NASDAQ: YGMZ) announced Wednesday that it entered into a Share Purchase Agreement (the “SPA”) on December 29, 2021 to acquire 100% of the equity interest of Cheyi (BVI) Limited (the “Cheyi BVI”) which operates its business through its subsidiary Zhejiang CheYi Network Technology Co., Ltd. (the “CheYi Network”), an integrated online car-hailing and driver management services company. Pursuant to the agreement, the total consideration for the acquisition of 100% equity ownership of Cheyi BVI is an aggregate of U.S. $29,466,032, consisting of the issuance by the Company to the shareholders of Cheyi BVI an aggregate of 3,189,000 fully paid Company’s ordinary shares (being U.S. $12,756,000 of $4 per share) and payment of $2,000,000 at closing, and Year-2021 earnout payment of U.S. $8,826,019 and Year-2022 earnout payment of U.S. $5,884,013 if the Cheyi BVI’s audited net income for its fiscal year 2021 and 2022 is no less than U.S. $3,000,000 respectively.
Payments Due 13 Months after Delivery
The two earnout payments are due 13 months upon the delivery of Cheyi BVI’s audited financial statements. The parties plan to close the transaction by December 31, 2021. The acquisition is expected to offer MingZhu’s customers additional platform enhancements, and directly fits with MingZhu’s acquisition strategy, which includes adding financially accretive, best-of-breed companies and products.
“We are excited to have CheYi Network now part of the MingZhu team. The company is a perfect fit and brings an impressive integrated platform featuring all the support and services drivers need. This immediately broadens our portfolio and will serve as a centerpiece of our continued diversification strategy. Our priority remains unchanged. We are focused on accelerating our growth strategy by strategically deploying capital in both organic and inorganic opportunities, as we unlock MingZhu’s potential and greater value for shareholders.”Mr. Jinlong Yang, Chairman and Chief Executive Officer of MingZhu Logistics Holdings Limited