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HONG KONG - Top Wealth Group Holding Limited (NASDAQ:TWG), currently trading at $0.15 and down over 80% in the past year according to InvestingPro data, announced Thursday it has entered into a legally-binding memorandum of understanding with Jilin Xiuzheng Agriculture and Animal Husbandry Technology for a proposed injection of animal-related pharmaceutical products, foods, and supplements business.
Under the agreement, Jilin Xiuzheng, a member of Chinese pharmaceutical company Xiuzheng Group, would inject its animal-related business operations into Top Wealth in exchange for new shares that would give Jilin Xiuzheng majority control and voting power of the company. The deal comes as TWG maintains a strong liquidity position with a current ratio of 3.25, though InvestingPro analysis indicates the company has been quickly burning through cash.
The transaction would include related trademarks, copyrights, manufacturing facilities, and usage rights to Xiuzheng Group’s distribution channels in China. Following completion, Jilin Xiuzheng would gain the right to nominate directors and appoint senior management, while Top Wealth’s existing caviar business would continue under its current management team.
The MOU remains effective for 120 days, during which Top Wealth will conduct due diligence and valuation of the business assets. The companies aim to reach a definitive agreement within this period.
According to the press release, Xiuzheng Group reported sales revenue of RMB67.7 billion in 2024 and ranks as the second largest privately-owned pharmaceutical group by revenue in China, as stated by the All-China Federation of Industry and Commerce.
Top Wealth Group currently specializes in supplying sturgeon caviar products under both private labels and its own Imperial Cristal Caviar brand. With revenue of $4.75 million in the last twelve months and a significant revenue decline of 72%, InvestingPro offers additional valuable insights about TWG’s financial health and growth prospects through its comprehensive analysis tools.
In other recent news, Top Wealth Group Holding Ltd has announced a significant change in its board of directors. Ms. Phei Suan Ho resigned from her roles, including as an independent director and chairwoman of the Audit Committee, citing personal reasons unrelated to any disagreement with the company. To fill the vacancy, the company appointed Mr. Kai Yin Wong as the new independent director and chairman of the Audit Committee. Mr. Wong brings over 19 years of experience in accounting and auditing to the role.
Additionally, Top Wealth Group has received a 180-day extension from Nasdaq to comply with the minimum bid price requirement of $1 per share. The company now has until December 8, 2025, to meet this requirement, failing which it risks delisting. Top Wealth stated its commitment to exploring all options to regain compliance. These developments were disclosed in recent company statements and filings.
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