TROOPS subsidiary to acquire 49% stake in Taiwan co-working space firm

HONG KONG - TROOPS, Inc. (NASDAQ:TROO), a $88 million market cap company currently trading near its 52-week low, announced Monday that its wholly-owned subsidiary Giant Connection Limited has entered into a Letter of Intent to acquire a 49% stake in WORK, Inc., a British Virgin Islands-registered co-working space operator with operations in Taiwan.

The agreement includes a put option allowing the seller, WORLD HONOR HOLDINGS LIMITED, to sell the remaining 51% ownership to TROOPS in the future, according to a company press release. InvestingPro data shows TROOPS maintains a healthy balance sheet with more cash than debt and a strong current ratio of 3.3x, potentially supporting its expansion plans.

The acquisition will be financed through convertible notes linked to TROOPS shares, priced at 80% of either the pre-signing closing price or the 60-day average, whichever is lower.

As part of the deal, TROOPS has committed to developing a 7,000 square feet co-working space in Hong Kong and creating a dedicated mobile application. The transaction remains subject to due diligence, regulatory approvals from NASDAQ and the SEC, and the absence of material adverse changes.

The LOI includes binding terms for confidentiality and exclusivity during the negotiation period.

TROOPS, Inc. is a Hong Kong-based conglomerate with diverse business interests including mortgage lending, property investment, financial technology solutions, migration advisory services, and insurance consultancy. Despite reporting impressive revenue growth of 182% in the last twelve months, InvestingPro analysis reveals 8 additional key insights about the company’s financial health and market position.

The company did not disclose the financial terms of the acquisition or a timeline for completing the transaction.

In other recent news, TROOPS, Inc. has been ordered to pay approximately US$51.9 million following an adverse judgment from the High Court of Hong Kong. This legal case, which has been ongoing since 2022, involves allegations of unlawful conspiracy against TROOPS and its subsidiaries. The company has expressed disappointment with the ruling and is considering appealing the decision. In another development, TROOPS, Inc. has entered into a stock purchase agreement with Wang & Lee Holdings, selling 14,050,000 ordinary shares for $12,645,000. A lock-up agreement prevents the purchaser from selling these shares for ten years, unless they receive prior consent from TROOPS. Additionally, TROOPS, Inc. has received a non-compliance notice from Nasdaq due to its stock price falling below the required minimum. The company has been given 180 days to rectify this issue, with the possibility of a second compliance period if necessary. TROOPS is exploring options to address this deficiency and maintain its Nasdaq listing.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.