August 31, 2023Looking for Steel Industry Interconnection GroupZG Group ("looking for Steel Network") has formally submitted its listing application to the Hong Kong Stock Exchange.AQUILA ACQUISITION CORPORATION(SPAC Company, hereinafter referred to as "Aquila") A special purpose acquisition company merger transaction (De-SPAC) application document.
Https://www1.hkexnews.hk/app/sehk/2023/105670/documents/sehk23083102130_c.pdf
Special purpose acquisition Company (SPAC) is a shell company with no actual business operation. After the initial public offering, SPAC must acquire an unlisted company within a specified period of time, so that the latter can indirectly obtain listing status. This process is called De-SPAC.
Previously, on August 31st,Aquila(07836.HK) notice vs.Looking for steel netThe merger agreement has been concluded and PIPE investment agreements have been entered into with 10 PIPE investors, with an investment amount of HK $605.3 million for PIPE and an agreed valuation of HK $10.004 billion for the SPAC merger and acquisition transaction. This is the first disclosed SPAC transaction since the new De-SPAC rules in Hong Kong.
AquilaInitiated by China Bank International Asset Management Co., Ltd., AAC Mgmt Holding Ltd, it was listed on the Hong Kong Stock Exchange on March 18, 2022 and was subscribed by 99 professional investors (including 40 institutional professional investors), raising about HK $1.00065 billion. According to the listing rulesAquilaThe special purpose acquisition shall be announced within 24 months after the listing date, and the special purpose acquisition shall be completed within 36 months after the listing date.
According toAquilaVs.Looking for steel netAccording to the merger agreement, each Aquila Class A share can be exchanged for 1.05newly issued Class A shares of the successor Company, and each Aquila Class B share (promoters' shares) can be converted into Class A shares for one newly issued Class A share of the successor Company, and each Aquila warrants can be exchanged for one equivalent listing warrant of the successor Company. The redeemed Aquila shares will be redeemed at a price of not less than HK $10 per share, and the dissenting Aquila shares may be paid in cash to the dissenting shareholders at the purchase price offer amount determined by the fair value of the Aquila shares.
The successor company is required to submit a new listing application to the HKEx to approve the listing and trading of Class A shares and warrants of the successor company on the main board of the Stock Exchange. Aquila will apply to the Stock Exchange to revoke the listing status of AquilaA shares (subject to the approval of AquilaA shareholders) and Aquila listing warrants. After delivery, the listing status of Aquila Class A shares and Aquila listing warrants will be revoked, and the inheriting Company Class A shares and inheriting company listing warrants will be listed on the main board of the Hong Kong Stock Exchange.
Under the listing rules of the HKEx, the Target Group is required to comply with rules 8.04 and 8.05 of the listing rules, and the successor Group is required to comply with all the new listing requirements set out in Chapter 8 of the listing rules (Rule 8.05 of the listing rules).
* Rule 8.04 of the listing rules of the HKEx stipulates that the issuer and its business must belong to those whom the Exchange considers suitable for listing; Article 8.05 is "profit Test" under (1), "Market ╱ income ╱ Cash flow Test" under (2), and "Market capitalization ╱ income Test" under (3).
Looking for steel netIt submitted a prospectus on the Hong Kong stock exchange on June 25, 2018 and proposed to adopt different voting structures and list on the Hong Kong main board in the form of red chips, which was jointly recommended by Citigroup, China Merchants and Goldman Sachs Group
Main business of target group
According to the data of Zhenshi Consulting, it is calculated according to the online steel trading volume in 2022Looking for steel netOperates the world's largest three-party steel trading digital platform. According to the information of Zuoshi Consulting, by connecting the major participants in the steel trading industry to its digital platformLooking for steel netTake the lead in providing one-stop B2B integrated services covering the whole value chain of steel trading in China, including online steel trading, logistics, warehousing and processing, financial technology solutions, SaaS products and big data analysis.
Looking for steel netTaking steel, an important industrial raw material, as a starting point, a highly flexible digital infrastructure has been established, and steel trading and service standards have been redefined.Looking for steel netNow it has become a trusted brand in the industry. With deep industry insight and advanced digital infrastructure, it is gradually expanding to a diversified market for non-iron and steel raw materials, including electronic components, electrical and electrical, and hardware and electrical machinery.
According to the information of searing knowledge consultation, in 2022,Looking for steel netA total of 35.3 million tons of steel transactions were recorded on the digital platform, accounting for about 38 per cent of China's total online steel transactions.
As of March 31, 2023Looking for steel netThe digital platform connects more than 167200 registered buyers, and the corporate buyer base is broad and loyal. In 2020, 93.2 per cent of the top 500 buyers by GMV contribution were still trading with the company in 2022. During the track record period, the average one-year cash retention rate of SME buyers in terms of GMV was 127.6 per cent.
According to the information of Shaoshi ConsultingLooking for steel netIt is also the only digital trading platform for light assets in the industry that provides full services. As of March 31, 2023Looking for steel netA nationwide logistics implementation network has been established, with more than 1500 registered logistics carriers, connecting more than 100000 trucks. According to the data of burning knowledge consultation, according to the steel Flowmeter in 2022Looking for steel netIt is the largest third-party steel trading terminal logistics service provider in China.
Looking for steel netLaunched three kinds of financial technology solutions tailored for buyers and sellers: fat cat white strips, fat cat easy to pick, and fat cat bills to effectively address the financing needs of industry participants and provide more payment options. As of March 31, 2023, the loan balance under the services of Tripartite Fat Cat Bailiao and Tripartite Fat Cat easy purchase has reached 1.364 billion yuan. According to the data of Fuji Consulting, it is calculated according to the loan balance of fintech solutions as of the end of 2022.Looking for steel netIt is the largest financial technology solution provider for third-party steel trading in China.
Looking for steel netIn June 2020, fat cat cloud, the first SaaS product of the steel trading industry, was launched, which is an ERP system seamlessly integrated with the company's digital platform. In addition, the company also launched a series of other SaaS products, including fat cat shopkeeper and Tengzitong, which jointly promoted the improvement of trading efficiency in the industry. According to the data of Zuoshi Consulting, according to the number of SaaS subscribers up to the end of 2022Looking for steel netIt ranks first in the digital platform of three-party steel trading in China.
Inherit the structure of group shareholders
The successor company adopts a different voting structure, with one vote for each Class A share and 10 votes for each Class B share. The Class B shares are indirectly held by Mr. Wang Dong and Mr. Wang Changhui, and the other shareholders are Class A shareholders. As of the date of the application document, the shareholder structure of the successor company immediately following the completion of the merger and acquisition of the special purpose company (assuming a presumption) is as follows:
Wang DongSir, Wangdong Holdings, which is controlled by the trust, holds 157523425 Class B shares, 13.23%, and 54.14% voting rights.
Wang ChanghuiSir, Wangchanghui Holding, which is controlled by the trust, holds 33512437 Class B shares, 2.82%, and 11.52% voting rights.
Rao HuigangSir, Raohuigang Holdings, which is controlled by the trust, holds 3.03% of the shares and 1.24% of the voting rights.
The above-mentioned shareholders are people who act in concert, holding a total of 19.08% and having 66.90% of the voting rights.
Share incentive scheme (excluding Wang Dong and Wang Changhui), holding 2.53%, with 1.04% voting rights
Domestic investors include Shanghai Yanmao, Shenzhen Cangxin and Shenzhen Cangjin, Shanghai Maxton, Shanghai Weiyi, Wuxi Bai Aoji, Shanghai Yunqi, Hangzhou Yunjia, Shenzhen Xianfeng, Jiaxing Fenglin, Zhuhai Fuhai, Hangzhou Sanren, Xinyu Zhongfu, China Renaissance Holdings Ltd., etc. Through Fatcat International Limited, they hold 14.55% of the shares and have 5.95% voting rights.
K2 Evergreen Partners L.P., with a 2.40% stake and 0.98% voting rights
K2 Partners II L.P., holding 5.60%, with 2.29% voting rights
Jamenia Holdings Limited, with a stake of 0.55% and a voting right of 0.22%
Unavo Holdings Limited, with a stake of 0.55% and a voting right of 0.22%
Zhen Partners Fund I, L.P., holds 4.45% and has 1.82% voting rights
Matrix Partner China II, L.P., holds 6.84% and has 2.8% voting rights
Matrix Partners China II-A, L.P., holds 0.76% and has 0.31% voting rights
Toasto Time Limited, with 0.42% stake and 0.17% voting rights
Tenzing Holdings 2011 Ltd., holds 0.81%, with 0.33% voting rights
Sequoia Sequoia Capital CV IV Holdco, Ltd., owns 3.12% and has 1.28% voting rights.
IDG-Accel China Capital II L.P., holding 3.53%, with 1.44% voting rights
IDG-Accel China Capital II Investors L.P., with 0.16% stake and 0.06% voting rights
Quick Returns Ventures Limited, with a 1.84% stake and 0.75% voting rights
Success Path Enterprises Limited, which owns 3.68% of the shares and has 1.5% voting rights
Pu Hua Capital, which holds 0.74% of the shares and has 0.30% voting rights.
Huaxing Capital Partners, L.P., controlled by China Renaissance Holdings Ltd., holds 0.74% of the shares and has 0.30% voting rights.
Bright Future International Trading Ltd, controlled by China Renaissance Holdings Ltd., holds 2.21% of the shares and has 0.90% voting rights.
MSA China Fund I L.P., with 0.86% stake and 0.35% voting rights
Jianshi Investment, with a stake of 8.63%, has 3.53% voting rights
Jianshi Tianhui holds 0.01% of the shares and has 0.005% voting rights.
* PIPE investors, who hold 5.09% of the shares and have 2.08% voting rights
Aquila Class A shareholders, holding 8.83%, with 3.61% voting rights
Aquila sponsor, holding 2.03%, with 0.83% voting rights
* PIPE investors
Aquila, looking for Steel Network, has entered into PIPE investment agreements with 10 PIPE investors, with an investment amount of HK $605.3 million for PIPE.
Assuming that no shareholders redeem the shares and there are no dissenting shareholders, or no new investors are introduced, the capital injection expected by Gangang after the merger will be the current cash of Aquila plus the investment amount of HK $605.3 million of PIPE investors, which will eventually be determined by the successor company and the sponsors in accordance with the promoters' commission and lock-up agreement.
PIPE investors include:
Xuzhou State-owned assets Supervision and Administration CommissionXuzhou ZhenxinUnder the State-owned assets Supervision and Administration Commission of Jiulongpo District, ChongqingYulong Group, Oriental Securities (600958. SHJI 03958. HK)Oriental asset management、Trafigura Group, Luzhou laojiao'sSichuan Pu XinIt is really for fund managementNing Hai really forUnder the Finance Bureau of Jian'an District, Xuchang CityXuchang industrial investment、Shanghai HaoyuanOwned by Mr. Wu YiGold Wings Holdings LimitedOwned by the wholly owned company of the State-owned assets Affairs Center in the upper district of ZhengzhouZhengzhou honesty.
Director and executive
The board of directors of the succession Group consists of 9 directors, including 4 executive directors, 2 non-executive directors and 3 independent non-executive directors.
Board of directors(9)
Senior management(11)
Senior executives include: chairman of the board, executive director and chief financial officerWang DongSir, Executive Director and Chief operating OfficerWang ChanghuiSir, Senior Vice PresidentGong YingxinMa'am, Vice President of FinanceZhou MinMa'am, vice presidentZhang XiaokunSir, vice president.Zhang XuruiSir, vice president.Dong YamingSir, vice president.Chen QingMa'am, vice presidentTan MeiqiangSir, vice president.Zeng LingyuSir, Secretary of the Board and Assistant Chief Executive OfficerMeng longMr.
Target group company performance
According to the listing application documents, in the past three months of 2020, 2021, 2022 and 2023,Looking for steel netThe income was 1.3498 billion, 1.3534 billion, 905.4 million and 221.6 million yuan respectively, and the net loss for the corresponding period was 456 million yuan, 274.4 million yuan, 366.1 million yuan and 044.6 million yuan respectively, and the adjusted net loss for the corresponding period was 254.9 million yuan, 109.1 million yuan, 231 million yuan and 300.3 million yuan respectively.
According to yesterday's announcement by Aquila, although the Target Group recorded a net loss for the three years ended 31 December 2022 and the three months ended 31 March 2023, the Target Group achieved positive operating cash flow in 2022 and its business model and future performance have great potential.
Intermediary team
The intermediary teams involved in this special purpose M & A transaction mainly include: China Banking International, HSBC and UBS as their co-sponsors and overall coordinators; Mercedes Asia and UBS as the target company's financial advisors; Deloitte as its auditor; Shihui and Kaiyi as the target company's Chinese lawyers and target company Hong Kong and American lawyers respectively; Junhe and Anli are their securities firms' Chinese lawyers and brokerage Hong Kong and American lawyers respectively. Freddie is the Hong Kong and American lawyer of SPAC; Pu Heng is the sponsor lawyer; and Burning Consulting is its industry consultant.