LEADING Group to merge with HAIA for Nasdaq listing

NEW YORK - LEADING Group Limited, a digital insurance broker in China, and Healthcare AI Acquisition Corp. (NASDAQ: HAIA), have announced a definitive business combination agreement. This merger is expected to position LEADING as the surviving entity on the Nasdaq Stock Market.

The transaction values LEADING at approximately $430 million, with an additional private placement financing of $50 million planned. Shareholders of LEADING will maintain a majority in the combined entity, and the current management team will continue to lead.

LEADING provides digital insurance brokerage and integrated marketing services, aiding insurance carriers in customer acquisition and enhancing premium sales growth. The company's services offer sales channel visibility and tailored solutions for individuals and corporate policyholders.

Chairman of LEADING, Mr. Ross Benson, expressed enthusiasm for the Nasdaq listing, citing it as a platform for growth capital and investor participation in China's burgeoning insurance market. Mr. Jiande Chen, CEO and Chairman of HAIA, highlighted LEADING's potential for growth as an Insurance Channel Specialist and the strategic step forward represented by the signing of the agreement.

The Proposed Transaction is set for completion in the fourth quarter of 2024, subject to approval by LEADING and HAIA shareholders and other customary closing conditions, including regulatory approvals. The proceeds are expected to accelerate LEADING's business growth in China.

Legal advisors for the transaction include Loeb & Loeb LLP for HAIA and Hogan Lovells for LEADING, among others.

The merger is unanimously approved by the boards of directors of both companies. Additional details will be filed with the U.S. Securities and Exchange Commission and made available to shareholders.

This article is based on a press release statement. The forward-looking statements in the press release are subject to various risks, uncertainties, and other factors that could cause actual results to differ materially from those projected.

InvestingPro Insights

As LEADING Group Limited gears up for its merger with Healthcare AI Acquisition Corp. (NASDAQ: HAIA), investors are closely monitoring key financial metrics and market indicators. According to InvestingPro, HAIA's stock generally trades with low price volatility, which could be appealing to investors looking for stability in their portfolio. Additionally, HAIA has been profitable over the last twelve months, a positive sign for potential investors eyeing the upcoming merger.

InvestingPro Data reveals a market capitalization of $61.67 million for HAIA, which places the company in a different valuation spectrum compared to the merger valuation of LEADING at approximately $430 million. A notable metric is the P/E ratio, which stands at 17.08, with an adjusted P/E ratio for the last twelve months as of Q4 2023 at 14.2. This suggests that the company is trading at a lower earnings multiple than the real-time P/E, potentially indicating a more attractive valuation for investors. Furthermore, the stock is trading near its 52-week high, at 99.13% of this peak, reflecting investor confidence leading up to the merger.

Among the InvestingPro Tips, it's important to note that HAIA suffers from weak gross profit margins and that its short-term obligations exceed its liquid assets. These factors could present risks that investors may want to consider. For those looking for additional insights, there are more InvestingPro Tips available, including analysis on dividend policies and market movement correlations, which can be found at InvestingPro.

Investors should also be aware that HAIA does not pay a dividend to shareholders, which may influence investment decisions depending on individual strategies and income preferences. With the next earnings date scheduled for August 16, 2024, those interested in the finer details of HAIA's financial health and the implications for the merger with LEADING will find comprehensive analysis on InvestingPro, which lists several additional tips to guide investment considerations.

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