Greenland Acquisition Corporation, a blank check company formed for the purpose of acquiring one or more businesses or entities, announced that it has signed a definitive share exchange agreement with Zhongchai Holding (Hong Kong) Limited, a leading developer and manufacturer of transmission products for material handling machineries in China. In addition, Zhongchai Holding has developed robotic cargo carriers, which it plans to produce and sell in the near future. Upon closing, Zhongchai Holding will become a wholly-owned subsidiary of Greenland, and Zhongchai Holding’s majority owned subsidiaries will become the operating entities of the Company. In addition, the Company will change its name to Greenland Technologies Holding Corporation.
Zhongchai Holding’s transmission products are key components for forklift trucks used in manufacturing and logistic applications. Zhongchai Holding’s revenues increased from approximately $49.1 million in 2017 to approximately $60.2 million in 2018 and its net income increased to approximately $6.6 million in 2018 from a net loss of approximately $3.3 million in 2017. Following the closing, Zhongchai Holding’s key executives are expected to remain as key executives of the combined company and continue to drive business growth.
Yanming Liu, Chairman and Chief Executive Officer of Greenland said, “On behalf of Greenland and our sponsor, Greenland Asset Management Corporation, we are extremely excited about the acquisition of Zhongchai Holding. Zhongchai Holding is a leading developer and manufacturer of transmission products for material handling machineries in China and had substantial revenue with a track record of strong organic growth. Mr. Peter Zuguang Wang and his team have many years of experience in the transportation industry. Zhongchai Holding is well-positioned for future growth, particularly with respect to the robotic product that Zhongchai Holding developed and expects to begin manufacturing and selling in the near future. With their experience and insights, we believe Zhongchai Holding has the potential to generate long-term value to Greenland’s shareholders. We are thrilled to be part of the next stage in this company’s life cycle and look forward to helping create value for our shareholders.”
Peter Zuguang Wang, sole director of Zhongchai Holding, also expressed his confidence in the proposed acquisition and of Zhongchai Holding becoming a U.S. public company. “We believe that as a Nasdaq-listed company, Zhongchai Holding can achieve its goals faster, taking advantage of the resources from the public capital markets to bring innovations to traditional transmission products as well as robotic cargo carriers quickly, motivate our workforce and grow together with our customers and partners to new and higher levels. With a widely-recognized brand in China, a growing customer base, a strong R&D team and a new robotic product expected to hit the market in the near future, Zhongchai Holding has many exciting growth opportunities going forward that we believe will create value to our investors.”
Under the terms of the share exchange agreement, Greenland will acquire all of the outstanding equity interests of Zhongchai Holding from Zhongchai Holding’s shareholder in exchange for 7,500,000 newly issued ordinary shares of Greenland. 10% of the ordinary shares payable to Zhongchai Holding’s shareholder in the transaction will be held in escrow for 18 months after the closing as security for Zhongchai Holding’s and such shareholder’s indemnification obligations under the share exchange agreement.
The board of directors of the Company after the closing will consist of five directors, who will be appointed prior to the closing, four of which will be independent. The four nominees of the independent directors are Messrs. Yanming Liu, Hong Liang Lu, Min Zhang and Everett Xiaolin Wang.
The transaction is subject to the satisfaction of customary closing conditions, including approval of Greenland’s shareholders. The transaction is expected to close by the end of 2019, promptly following Greenland’s special shareholders’ meeting to approve the transaction.
Ellenoff Grossman & Schole LLP and Ogier are acting as legal advisors to Greenland. T&C Law Firm is acting as legal advisor to Zhongchai Holding.
The description of the transaction contained herein is only a summary and is qualified in its entirety by reference to the definitive share exchange agreement relating to the transaction, a copy of which will be filed by Greenland with the Securities and Exchange Commission (the “SEC”) as an exhibit to a Current Report on Form 8-K.
About Greenland Acquisition Corporation
Greenland Acquisition Corporation is a blank check company formed for the purpose of acquiring, engaging in a share exchange, share reconstruction and amalgamation with, purchasing all or substantially all of the assets of, entering into contractual arrangements with, or engaging in any other similar business combination with one or more businesses or entities.
About Zhongchai Holding (Hong Kong) Limited
Zhongchai Holding (Hong Kong) Limited is a holding company incorporated under the laws of Hong Kong. It is a developer and manufacturer of traditional transmission products for material handling machineries and a developer of a robotic cargo carrier prototype expected to be available for commercial use in the near future in China.