Kaixin Auto Holdings [NASDAQ: KXIN] has disclosed today that it has entered into a ‘Binding Term Sheet’ with Haitaoche Limited on November 3, 2020. The company has also announced changes to its senior management team.
As per the terms and conditions of the Binding Term Sheet, Haitaoche & the newly formed wholly-owned subsidiary of Kaixin will be merged. After the merger, Haitaoche will continue its operations as the wholly-owned subsidiary of Kaixin.
Kaixin Auto revealed that it will provide a number of ordinary shares of Kaixin to Haitaoche’s shareholders. They will receive 51% of share capital after the closing of the merger.
Shares of Kaixin Auto Holdings [NASDAQ: KXIN] soared 79.42% at 4.930 at the time of writing on Thursday. It has a trading volume of 14.17 million as compared to the average volume of 6.51 million.
Kaixin has a 52-weeks low range of $0.40 and a high range of $13.40. It has traded up 592.33% from its 52-weeks low and traded down -79.33% from its 52-weeks high.
Turning our focus on its liquidity, it has a current ratio of 1.00 and a quick ratio of 0.60. KXIN market capitalization has remained high, hitting 183.07 million at the time of writing.
Now look at the company’s Binding Term Sheet with Haitaoche, Haitaoche will involve the company in the business of selling its vehicles as part of the merger. It is also planning to involve the company in other projects after the merger.
Haitaoche is best known as the e-commerce platform for imported automobiles. It is a Chinese-based company that is currently trying to become the largest retailer platform for the automobile in China.
After the execution of transaction, the shareholders of Haitaoche will be able to appoint a majority of directors of Kaixin.
Now, look at the management changes which both companies have made after the agreement. Mr. Jinfeng Xie & Mr. Chen Ji will leave their position from November 3, 2020. Mr. Chen Ji was the CEO and Mr. Jinfeng Xie was the COO of Kaixin.
Hence, the Boards of Directors of the company has named Mr. Mingjun Lin as the company’s acting CEO, effective as of November 3, 2020. Mr. Mingjun Lin is the founder of Haitaoche.
He has keen experience in automotive internet media. He has served in senior management positions in Tencent and TOM before founding Haitaoche.