Gelonghui December 17, vobile group (03738.HK) issued an announcement, December 17, 2021 (before the trading session)Wholly owned subsidiary of the companyHangzhou Fubo, management shareholders and other existing shareholders (except Hangzhou Wenyue) act as vendors and Particle Culture Technology Group (Hangzhou) Co., Ltd. (particle Technology, as the target company) enter into a sale and purchase agreement for the proposed acquisition involving the Target Group.
As at the date of the announcement, the Target Group mainly engaged in SaaS business in China through two main products: (I) video distribution and edge computing SaaS and (ii) content cash services. The restricted entity holds a number of licenses and permits required for the restricted business in accordance with the relevant laws and regulations of the people's Republic of China. Under China's foreign investment policy, foreign investors are restricted or prohibited from owning equity in entities that operate restricted entities. Because the company is owned by foreign capital, the foreign ownership of restricted entities is restricted according to Chinese law. However, some of the businesses of the target group are not subject to any restrictions on foreign investment in China.
The proposed acquisition will be implemented as follows: (a) (I) the operating company acquires 61.18% equity interest in the new target company held by the restricted entity; and (ii) a variable interest entity contract entered into by, among other things, the wholly foreign-owned enterprise, the operating company, the new holding company and the PRC nominee shareholders; and (b) the wholly foreign-owned enterprise acquires 61.18% equity interest in the target company held by other non-restricted entities. The total consideration is RMB 854 million, which must be repaid in cash.
According to the announcement, the Group is a leading online video content protection and cash service provider to assist its content owners to identify potential infringing content and reduce revenue loss arising from infringement. and through the use of our revenue-sharing model of the content realization platform to assist in online video distribution to increase customer revenue. Through the target group, the seller is mainly engaged in video distribution and edge computing SaaS and content realization services in China. The proposed acquisition provides the Group with a golden opportunity to further consolidate its position as a leader in online video content protection and realization by seizing market opportunities, and to further realize the potential of the Chinese market with one of the best senior teams in the industry with an outstanding track record.