LONDON: Sealand Capital Galaxy Limited (LSE: SCGL) announced it has entered into a conditional Share Purchase Agreement to acquire a 60% controlling interest in Finely Technology Holdings Limited, a Cayman Islands-incorporated technology company with core operations in Hong Kong, for total consideration of £12 million.

The acquisition implies a valuation of £20 million for 100% of FT, which specializes in enterprise software, cloud-native platforms, Internet of Things technologies and digital infrastructure solutions.

About Finely Technology

FT operates through its wholly-owned Hong Kong subsidiary, Finely Technology (HK) Limited, and has developed an integrated technology platform combining cloud infrastructure, customized software applications, connected hardware and global mobile data connectivity.

The company’s technology has been commercialized with customers in the intelligent two-wheeled electric vehicle sector across North America, South America and Southeast Asia.

FT’s core team is based in Hong Kong and includes hardware engineering, software development, cloud platform, client account management and commercial sales functions. Mr. Wei Fengcao, FT’s majority beneficial owner and chief executive officer, along with the core management team, are subject to 36-month retention and non-compete undertakings following completion.

FT has reported growing profitability:

· Audited FY2024 revenue of $3.73 million and net profit of $0.43 million

· Audited FY2025 revenue of $6.61 million and net profit of $0.96 million

· Unaudited FY2026 revenue of approximately $5.32 million and net profit of approximately $1.41 million

The financial periods are for years ended March 31.

Strategic Rationale

Sealand’s board said the acquisition represents an important step in its roadmap to build a broader technology business focused on artificial intelligence, enterprise software, SaaS, cloud technologies and digital infrastructure.

FT brings an established and profitable operating business with its own technology platform, international customer relationships and expertise across enterprise software, cloud-native platforms, IoT connectivity and connected devices.

Sealand intends to support FT in expanding into new markets and sectors while exploring opportunities to introduce additional Sealand technologies and services to FT’s existing customers.

Terms of the Deal

The £12 million consideration will be satisfied through a combination of cash and new ordinary shares:

· £6 million in cash, payable in installments within six months of the SPA date. Any amount remaining unpaid at the end of that period may instead be satisfied through the issue of new ordinary shares at 1.2 pence per share.

· £6 million in new ordinary shares, to be issued to selling shareholders at 1.2 pence per share following completion.

Completion is subject to customary conditions, including corporate, regulatory and third-party approvals, the accuracy of warranties given by selling shareholders, and the absence of any material adverse effect affecting FT. The parties have agreed to complete the acquisition by Sept. 30, 2026.

Post-Completion Rights

Following completion, Sealand will hold 60% of FT and will have the right to appoint a majority of its board and nominate its chairman and chief financial officer. Sealand will also benefit from customary shareholder protections, including consent rights over certain material corporate actions, pre-emption rights, rights of first refusal and tag-along rights, along with financial reporting and information rights.

Performance Commitment

Under the SPA, Mr. Wei Fengcao and FT have undertaken that FT will achieve audited net profit of not less than $1.6 million for the year ending Dec. 31, 2027.

If FT’s audited net profit for that period is less than 80% of the performance commitment — equivalent to $1.28 million — Sealand will be entitled either to receive cash compensation calculated by reference to the shortfall and the £6 million cash element of the consideration, or to terminate the SPA and require repayment of all consideration already paid, together with interest at a simple annual rate of 8%.

Executive Commentary

Siqi Cao, chief executive officer of Sealand, said the acquisition represents another important step in the company’s ambition to build a broader technology group with meaningful operating businesses and revenues.

“FT is an established and profitable business with proven capabilities across enterprise software, cloud technologies and IoT, together with an international customer base,” Cao said. “Importantly, its technology is already being successfully commercialized, giving us a strong platform from which to pursue further growth.”

Cao said Sealand sees considerable opportunities to support FT’s expansion into new markets and sectors, while also bringing its technology and expertise into the wider Sealand Group. He noted that FT’s commercialization of connected technology solutions in the two-wheeled electric vehicle sector provides a foundation from which to explore opportunities in the UK and European markets, where increasing focus on ESG and sustainable mobility may create further opportunities.

Mr. Wei Fengcao, controlling shareholder and CEO of Finely Technology Holdings Limited, said joining Sealand represents an exciting next stage in FT’s development.

“As part of Sealand, we will have access to greater resources, an international network and a broader range of technology capabilities, which will help us accelerate our growth and take our products and services into new markets and sectors,” Wei said.

Share Issuance

Sealand will allot 500,000,000 new fully paid ordinary shares of par value £0.0001 at a price of £0.012 per Consideration Share. The shares will rank pari passu with existing ordinary shares. Application will be made to the London Stock Exchange for admission to trading, with a further announcement to be made post-completion to confirm the admission date and total voting rights.

Sealand Capital Galaxy Limited’s ordinary shares are admitted to the Equity Shares (transition) category of the Financial Conduct Authority’s Official List and admitted to trading on the London Stock Exchange’s Main Market. The company focuses on AI and SaaS software tools to support the commercial deployment of digital management solutions, along with computing-power infrastructure and energy technology.