M&A: Finnovate Acquisition Corp.

Form Type: DEFM14A

Filing Date: 2025-01-06

Corporate Action: Merger

Type: New

Accession Number: 000121390025001247

Comments: Finnovate Acquisition Corp. has obtained unanimous approval from its board of directors for a Business Combination Agreement with Scage International Limited and other subsidiaries, set to be executed in two sequential mergers. The first merger involves Merger Sub I merging with Scage International, making it a wholly-owned subsidiary of the new parent company, PubCo. Following that, Finnovate will merge into Merger Sub II, making it, too, a wholly-owned subsidiary of PubCo. The business combination results in conversion of shares from Finnovate and Scage International into PubCo Ordinary Shares, with a comprehensive plan for stock conversion detailed according to the Exchange Ratio specified in the Business Combination Agreement. Financial evaluations suggested an enterprise value of US$800 million for Scage International in this merger. Fairness opinions reflected the financial viability for Finnovate's shareholders. The completion of this combination hinges on shareholder approval and regulatory confirmations, especially related to compliance with PRC regulations. There are risks associated with the ability to conduct overseas offerings, particularly for businesses conducted in jurisdictions like China, which could significantly affect the operations and securities valuations post-merger. The document also outlines the implications for shareholders, including expected changes in stock listings and potential deregulatory actions under U.S. securities laws.

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