Activeworlds to Acquire a Leading Chinese Jewelry Manufacturer
Activeworlds Corporation (AWLD), which competes with companies like Tiffany & Co. (TIF) and Blue Nile Inc. (NILE), announced that it would be acquiring a leading 24k gold jewelry manufacturer in China.
Activeworlds Corp. [[AWLD.OB]], announced that it has entered into a definitive agreement to acquire Wuhan Kingold Jewelry Co., Ltd., (“Kingold”). Kingold, located in Wuhan, Hubei Province, was founded in 2002 and is a leading Chinese designer and manufacturer of 24-K gold jewelry.
The transaction is structured as an acquisition of the corporate parent of Wuhan Vogue-Show Jewelry Co., Ltd. (“Vogue Show”), a People’s Republic of China (“PRC”) corporation which has entered into a series of captive agreements with Kingold pursuant to which it will receive 95.83% of the profits of Kingold. Known as a variable interest agreement or “VIE”, this is a common structure used to acquire PRC corporations within certain industries designated by MOFCOM, the PRC’s Ministry of Commerce. Vogue Show, a wholly-foreign owned enterprise (“WFOE”), is owned by Dragon Lead Group Limited, a British Virgin Islands corporation. At the closing, Activeworlds will acquire 100% of Dragon Lead Group Limited.
Consummation of the acquisition is subject to numerous conditions, including satisfactory due diligence reviews conducted by Activeworlds and Kingold and a private placement of Activeworlds common stock and warrants in the amount of $5 million prior to the closing. Thus, there can be no assurance that the transaction will be consummated.
View Activeworlds Corp. Annual Report
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