Horizon Space Acquisition I Corp.(US:HSPOU)2024-03-29 23:30IPO and Financial Status - The company completed its IPO on December 27, 2022, raising gross proceeds of $69.0 million from the sale of 6,900,000 Public Units at $10.00 each[13]. - The company has no revenue and has incurred losses since inception, relying on the sale of securities and loans from the Sponsor to fund operations[17]. - As of the September 2023 Shareholder Meeting, 562,779 Ordinary Shares were redeemed, resulting in approximately $5.93 million released from the Trust Account[20]. - The company has the option to extend the deadline for consummating a business combination up to six times, with each extension costing $70,000 deposited into the Trust Account[20]. - A total of $480,000 in Monthly Extension Fees has been deposited into the Trust Account, with contributions from both the Sponsor and Shenzhen Squirrel[25]. - The company may request the Trustee to distribute up to $100,000 from the Trust Account for future dissolution expenses[23]. - If the company cannot complete the initial business combination by April 27, 2024, it will redeem 100% of the public shares for a pro rata portion of the Trust Account funds[44]. - As of December 31, 2023, the company was not subject to any market or interest rate risk, with net proceeds from the IPO invested in mutual funds with underlying investments in U.S. Treasury securities[152]. Business Combination Strategy - On October 17, 2023, the company entered into a non-binding Letter of Intent with Shenzhen Squirrel for a potential business combination[30]. - The company established a Special Committee on November 1, 2023, to evaluate the proposed business combination with Shenzhen Squirrel[31]. - The company has not selected any target business for its initial business combination as of now[12]. - The management team aims to create shareholder value by improving operating efficiency and implementing revenue-driven strategies through acquisitions[37]. - The company intends to acquire emerging growth companies that are either cash-generative or have the potential to generate cash, focusing on niche deal sizes[38]. - The acquisition strategy includes targeting companies with long-term revenue visibility and a defensible market position, particularly those at an anticipated inflection point[39]. - The company plans to evaluate potential acquisitions based on organic growth potential, cost savings, and opportunities for follow-on acquisitions[39]. - The initial business combination must involve target businesses with a collective fair market value of at least 80% of the Trust Account balance[46]. - The company anticipates structuring the initial business combination to acquire 100% of the equity interests or assets of the target business[48]. Regulatory and Compliance Issues - The company may face regulatory challenges if it pursues a business combination with a PRC target company, potentially affecting its ability to list on U.S. exchanges[51]. - The Holding Foreign Companies Accountable Act (HFCAA) requires public companies to disclose whether they are owned or controlled by a foreign government, specifically those based in China[58]. - The HFCAA mandates that if a public company’s auditor cannot be inspected by the PCAOB for three consecutive years, trading of its securities on U.S. exchanges will be prohibited[60]. - On December 15, 2022, the PCAOB determined it has secured complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong[66]. - The Consolidated Appropriations Act, signed into law on December 29, 2022, reduced the number of consecutive non-inspection years required for triggering prohibitions under the HFCAA from three years to two[67]. - The company may face restrictions on completing business combinations with certain China-based businesses due to U.S. laws and executive orders[70]. - The process of government review by CFIUS could be lengthy, potentially impacting the company’s ability to complete its initial business combination within the required time[74]. - The PCAOB intends to release inspection reports detailing findings from their inspections of audit firms in mainland China and Hong Kong in the first half of the following year[66]. - The company has no operations or subsidiaries in China, being incorporated in the Cayman Islands with its office located in the United States[56]. Management and Ownership - The company has waived the full payment of the Administrative Service Fee, which was $1,000 per month[29]. - The management team has extensive experience in public and international companies, enhancing the company's ability to identify and evaluate acquisition targets[35]. - The company’s sponsor owns approximately 24.20% of the issued and outstanding shares, with Mr. Mingyu (Michael) Li as the sole director and member of the sponsor[71].