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Venus Acquisition Corporation *

Venus Acquisition Corporation *

Dec 18, 2020 by Matt Cianci

PROPOSED BUSINESS COMBINATION: VIYI Algorithm Inc.

ENTERPRISE VALUE: $400 million
ANTICIPATED SYMBOL: ALGO

Venus Acquisition Corporation proposes to combine with VIYI Algorithm Inc.

VIYI Algo is dedicated to the development and application of bespoke central processing algorithms. Central processing algorithms refer to a range of computing algorithms, including analytical algorithms, recommendation algorithms, and acceleration algorithms. VIYI Algo provides comprehensive solutions to customers by integrating central processing algorithms with software or hardware, or both, thereby helping them to increase the number of customers, improve end-user satisfaction, achieve direct cost savings, reduce power consumption, and achieve technical goals.

The range of VIYI Algo’s services include algorithm optimization, accelerating computing power without the need for hardware upgrades, lightweight data processing, and data intelligence services. VIYI Algo’s ability to efficiently deliver software and hardware optimization to customers through bespoke central processing algorithms serves as a driving force for VIYI Algo’s long-term development. VIYI Algo is ideally positioned to grow its revenue quickly as a leading central processing algorithm service provider in China.

Currently, VIYI Algo is focused on developing and delivering central processing algorithm solutions to customers engaged in internet advertisement and gaming, and intelligent chips. VIYI Algo’s customer base is rapidly growing due to a general demand for more efficient data processing in various industries driven by the growing internet population and prevalence of AI. In the mid-to-long term, VIYI Algo will continue to adhere to its strategic mindset. By improving upon each iteration of VIYI Algo’s one-stop intelligent data management solutions made possible by its proprietary central processing algorithm services, VIYI Algo can help customers to enhance their service efficiency and make model innovations in business, and actively enhance the industry value of the central processing algorithm services in the general field of data intelligent processing industry.

VIYI Algo is controlled by WiMi Hologram Cloud, Inc. (NASDAQ: WIMI), whose commercial operations began in 2015. Wimi Hologram Cloud, Inc. is a holographic cloud comprehensive technical solution provider that focuses on professional areas including holographic AR automotive HUD software, 3D holographic pulse LiDAR, head-mounted light field holographic equipment, holographic semiconductor, holographic cloud software, holographic car navigation and others. Its services and holographic AR technologies include holographic AR automotive application, 3D holographic pulse LiDAR technology, holographic vision semiconductor technology, holographic software development, holographic AR advertising technology, holographic AR entertainment technology, holographic ARSDK payment, interactive holographic communication and other holographic AR technologies.

SUBSEQUENT EVENT – 11/23/22 – LINK

  • The SPAC and the Sponsor of the Issuer, Yolanda Management Corporation entered into a backstop agreement with Joyous JD Limited
    • The Buyer has agreed to backstop SPAC Share Redemptions, to purchase Issuer Shares from third parties through a broker in the open market (other than through the Issuer), or through privately negotiated transactions, including from SPAC Shareholders that had elected to redeem the Issuer Shares.
    • The Buyer shall acquire the Issuer Shares of an aggregate value up to US$25,000,000 at the redemption price/Share.
    • In order to effectuate the foregoing, to the extent legally permitted to do so, the Buyer shall purchase redeemed shares on the date of this Agreement until the date of the closing of the Merger.
    • The Buyer hereby agrees and undertake that they will not exercise any right of redemption with respect to any shares of the SPAC they may acquire.

SUBSEQUENT EVENT – 9/30/22 – LINK

  • On September 30, 2022, the Company engaged Marcum as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2022, effective immediately.

SUBSEQUENT EVENT – 8/10/22 – LINK

  • On August 10, 2022, Venus, VIYI and WiMi entered into a fourth amendment to the Merger Agreement).
    • The purposes of the Amendment were to change the requirement of VIYI’s for delivering to Venus the quarterly reviewed financial statements for the period ended June 30, 2022 from a representation and warranty to a covenant with such financial statements to be delivered not later than September 15, 2022, and to make certain other conforming changes regarding the current status.
  • On January 24, 2022 (LINK), Venus entered into a Backstop Agreement with WiMi, based on which WiMi shall invest $15,000,000 into the combined company at merger closing or make purchase on the public market.
    • However, based on the term of the Backstop Agreement, the Backstop Agreement terminated automatically on June 30, 2022. 

SUBSEQUENT EVENT – 8/4/22 – LINK

  • On August 3, 2022, Venus, VIYI and WiMi entered into a third amendment to the Merger Agreement.
  • The purposes of the amendment were to remove the approval of issuance by Venus of an aggregate of up to 1,485,149 Venus ordinary shares which may be issued to the Backstop Investor pursuant to the Backstop Agreement.

SUBSEQUENT EVENT – 8/2/22 – LINK

  • On August 2, 2022, Venus, VIYI, and WiMi entered into a second amendment to the Merger Agreement (the “Amendment”). The purposes of the amendment were to:
    • Extend the outside termination date of the proposed merger to November 11, 2022
    • Include as a closing condition the requirement that the requisite vote of the shareholders of VIYI has been obtained
    • Include the requirement of the audited financial statement of VIYI for the year ended 2021 and reviewed financial statement of VIYI for the periods ended June 30, 2022 and March 31, 2022

EXTENSION – 4/11/22 – LINK

  • On April 11, 2022, the SPAC elected to extend the date by which we are required to complete a business combination to May 11, 2022 and deposited $153,333 into our trust account.

EXTENSION – 3/11/22 – LINK

  • On March 11, 2022, the SPAC elected to extend the date by which we are required to complete a business combination to April 11, 2022 and deposited $153,333 into our trust account.

EXTENSION – 2/11/22 – LINK

  • On February 11, 2022, the SPAC elected to extend the date by which we are required to complete a business combination to March 11, 2022, and deposited $153,333 into our trust account.

SUBSEQUENT EVENT (1/24/22) – LINK

On January 24, 2022, Venus, VIYI and WiMi entered into an amendment to the Merger Agreement.

  • Extended the outside termination date of the proposed merger to June 30, 2022
  • Terminated the old backstop agreement that was from the Deal announcement
    • Venus has entered into a new backstop agreement with WiMi Hologram Cloud, Inc., the majority shareholder of VIYI for up to $15 million
    • The Buyer will have the right but not the obligation to acquire up to US$15,000,000 aggregate amount of shares of SPAC in the open market or private transactions at prices of no greater than the redemption price per Share disclosed in the most recently filed Registration Statement plus $0.05 (the “Price Per Share”) ($10.15/share)

TRANSACTION

  • The merger is structured as s stock for stock transaction and is intended to qualify as a tax-free reorganization.
  • The terms of the merger provide for a valuation of VIYI Algo and its subsidiaries and businesses of $400,000,000.
  • Based upon a per-share value of $10.10 per share, the VIYI Algo stockholders will receive approximately 39,600,000 ordinary shares of Venus which will represent approximately 85% of the combined outstanding shares following the closing, assuming no redemptions by the Venus stockholders and assuming conversion of the Venus outstanding rights into 485,000 ordinary shares.

BACKSTOP

  • Subsequent Event – On August 3, 2022, Venus removed an aggregate of up to 1,485,149 Venus ordinary shares which may be issued to the Backstop Investor pursuant to the Backstop Agreement.
  • Venus has entered into a definitive and binding backstop and subscription agreement with Ever Abundant Investments Limited who has committed to backstop up to $10,000,000 of redemption of ordinary shares by Venus stockholders or to purchase new shares from Venus at closing of the merger.

LOCK-UP

  • Concurrently with the closing of the merger, Purchaser will enter into a lock-up agreement with each of its IPO sponsor and the Company Shareholders with respect to the Consideration Shares received by the Company Shareholders in the Merger. The Lock-up Agreement provides that except for an aggregate of 2,000,000 ordinary shares received by the of the Company Shareholders, all shares held by the parties to the Lock-up agreements will be subject to restrictions of sale, transfer or assignment as follows:
    • (A) 50% of the shares until the earlier of
      • (i) six (6) months after the date of the consummation of the Merger or
      • (ii) the date on which the closing price of our ordinary shares equals or exceeds $12.50 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after the Merger and
    • (B) the remaining 50% of the shares may not be transferred, assigned or sold until six (6) months after the date of the consummation of the Merger.

NOTABLE CONDITIONS TO CLOSING

  • Purchaser’s name has changed to “MicroAlgo Inc.”
  • The authorized share capital being increased to 200,000,000 ordinary shares
  • Include as a closing condition the requirement that the requisite vote of the shareholders of VIYI has been obtained
  • Include the requirement of the audited financial statement of VIYI for the year ended 2021 and reviewed financial statement of VIYI for the periods ended June 30, 2022 and March 31, 2022

NOTABLE CONDITIONS TO TERMINATION

  • The Merger Agreement may be terminated by either the Purchaser Parties or the Company if Closing has not occurred by February 12, 2022.
  • Extended the outside termination date of the proposed merger to June 30, 2022
  • Extend the outside termination date of the proposed merger to November 11, 2022

ADVISORS

  • Becker & Poliakoff is acting as U.S. legal advisor to Venus
  • Ogier is acting as its Cayman Islands legal advisor.
  • DLA Piper is acting as U.S. legal advisor to WiMi Hologram Could Inc. and VIYI Algorithm Inc.
  • Maples and Calder (Hong Kong) LLP is acting as Cayman Islands legal advisor to VIYI Algorithm Inc.
  • Zhuo Ne Law Firm is acting as its PRC advisor.

MANAGEMENT & BOARD

Executive Officers

Yanming Liu, 58
Chairman and Chief Executive Officer

Mr. Liu served as the Chairman and Chief Executive Officer of Greenland until its acquisition of Zhongchai in October 2019. Mr. Liu currently serves as a director of Greenland’s successor entity, Greenland Technologies Holding Corp. Mr. has served as President of CoAdna (Suzhou), a fiber optics solutions company in China, since March 2013. From November 2010 to February 2013, Mr. Liu served as President of two optical access business units of HiSense Broadband and Multimedia Technologies, an optical communications company. From March to October 2010, Mr. Liu served as a senior advisor to EJ McKay & Co., Inc. with respect to various technology matters. From August 2005 to February 2010, Mr. Liu served as President and Chief Executive Officer of Salira Systems Inc., a producer of optical access products in China and the U.S. Previously, Mr. Liu served as an executive of Optovia Corporation and Walsin Management Company. In addition, from 1993 to 2001, Mr. Liu worked in various roles for Corning Incorporated, most recently as Director of Communications Electronics and Integration, where his roles included invention of Corning’s award-winning patented LEAF fiber product and marketing such product in China and other markets. Mr. Liu received a bachelor degree from Tianjin University in China, a MBA degree from the MIT Sloan School of Management and a Ph.D. and a MA degree from Princeton University.

River Chi, 40
Chief Financial Officer

Mr. Chi has served as the Chief Executive Officer of Alum Developing (Shanghai), Inc., a distributor of alloys in China, since November 2017 and previously served as the company’s Chief Operating Officer starting in 2013. From 2007 until 2012, Mr. Chi served as the operations manager of Salira (China) Network System Inc., where he worked with Mr. Liu. From 2005 to 2007, Mr. Chi served as project manager for AsteelFlash Electronics (Shanghai) Co., Ltd., an international electronic manufacturing services company. From 2003 to 2005, Mr. Chi served as manufacturing engineer for Darfon Electronics (SuZhou) Co., Ltd., a manufacturer of telecommunication components and precision devices. Mr. Chi received a bachelor degree from Northeastern University and a MBA from Shanghai Jiao Tong University.

Board of Directors

Yu Chen, 54
Director

Mr. Chen has served as founder and Chief Executive Officer of Nanjing Covision Optoelectronics Co., Ltd., a developer of display and lighting applications in China, since October 2013. From 2009 to 2013, Mr. Chen worked at HiSense Broadband and Multimedia Technologies, where he worked with Mr. Liu, most recently serving as a Deputy Director of Technology. In 2008, Mr. Chen served as a senior engineer for Luminus Devices, a designer of light extractions for LED products. Prior to that, Mr. Chen worked as an engineer for various technology companies in China and North American and as a researcher at the University of Waterloo, since 1986. Mr. Chen received a masters degree from the University of Waterloo in Canada and a Ph.D. from McMaster University in Canada.

Guojian Chen, 28
Director

Mr. Chen serves as the Secretary of Board of Beijing ChinaReel Art Exchange Inc. a leading copyright operator focusing on high-quality video content, since May 2020, where he is in charge of investor relations and corporate finance matters for the company. Mr Chen served as a director of Beijing Zhongqixinhe Enterprise Management Consulting Co., Ltd., a financial advisory firm with focus on financial, real estate and TMT industry from May 2019 to May 2020. Mr. Chen served as an analyst of Zhongrong Huitong Investment Fund Management (Zhuhai) Co. LTD. from July 2018 to May 2019. Mr. Chen received his Bachelor degree of Management from Renmin University of China in 2015, and Master of Finance from the University of Chinese Academy of Sciences in June 2018.

Shan Cui, 48
Director

Shan Cui has been an independent director and chair of the audit committee and compensation committee of Fuqin Fintech Limited, an online lending information intermediary platform, since August 28, 2018. She has been the Executive Director of First Capital International Limited since 2010 and provided consulting services for private equity companies and venture capital companies. She was the CFO of Lizhan Environmental Corporation, a then Nasdaq-listed company engaged in the business of green leather material manufacturing, from 2011 to 2013. From 2009 to 2010, she was the Manager of Planning and Analysis for Greene, Tweed & Company, a manufacturer of high-performance engineering parts and products serving aerospace, oilfield, and semi-conductor industries. Prior to that, Ms. Cui was the Senior Finance Manager at Ikon Office Solutions from 2005 to 2008, the CFO for Invista from 2003 to 2004, the Senior Financial Consultant for the Peachtree Companies from 2001 to 2003, the Manager of Strategic Planning and Analysis for General Time Corporation from 1998 to 2001, and the Senior Vice President for Seaboard Corporation from 1996 to 1998. Ms. Cui acquired her MBA degree in Business Administration from Georgia State University and her Bachelor’s degree in International Business English from Ocean University of China.

 

ByMatt Cianci