Prime Acquisition Corp. (“Prime”) (NASDAQ: Common Stock: “PACQ”, Units: “PACQU”, Warrants: “PACQW”), a special purpose acquisition company, and privately held Yuantong Investment Holdings Limited today announced that they have entered into a definitive share exchange agreement whereby Prime will issue 4.2 million ordinary shares in exchange for 100.0% of Yuantong.
Ms. Diana Liu, CEO of Prime, stated, “When we first formed Prime, our goal was to find a well-managed, high-growth business that was poised to take advantage of both long-term industrial growth in greater China with a strong international customer base and presence. We also were seeking a target that operated under a basic corporate structure (not a VIE), and did not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support. Given the current climate for US-listed China-based equities, we felt this was an important distinction. After a thorough due diligence and evaluation process, we are confident that Yuantong possesses all these qualities and look forward to working with the Company’s management team, led by industry veteran Weidong (Peter) Guo. Peter’s management team possesses an aggregate of over 50 years of experience in the metal casting and molding and specialty wheel markets. We feel that Yuantong’s long-standing customer relationships and quality reputation with some of the largest auto part manufacturers provides a sense of credibility to potential investors, and a wide range of end markets (primarily in the auto and specialized parts sectors) allows for considerable growth potential. We intend to work closely with the management team to help develop and grow Yuantong and are excited about the possibilities in the years ahead.”
Details of Transaction/Business Combination
Under the terms of the transaction, Prime will acquire 100.0% of Yuantong in exchange for 4.2 million newly issued ordinary shares of Prime (representing a total transaction value of approximately $42 million based on an agreed upon price of $10.00 per share).