Benzinga | Jun 10, 2021 09:07AM EDT

Venus Acquisition Corporation Announces Proposed Business Combination With VIYI Algorithm Inc., Which Is Controlled By WiMi Hologram Cloud; Terms Of Merger Provide Valuation Of VIYI Algo And Subsidiaries At $400M

Venus Acquisition Corporation (NASDAQ:VENA) ("Venus"), a publicly traded special purpose acquisition company, and VIYI Algorithm Inc. ("VIYI Algo"), a Cayman Islands exempted company operating in China and controlled by WiMi Hologram Cloud, Inc. (NASDAQ:WIMI), announced today that they have entered into a definitive merger agreement. A newly created merger subsidiary of Venus will be merged with and into VIYI Algo with VIYI Algo being the surviving entity and becoming a wholly owned subsidiary of Venus. Upon closing of the transaction, Venus will change its name to MicroAlgo Inc.

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.

Pursuant to the terms of the proposed merger, the post-closing Board of Directors will consist of 5 members, four of whom will be nominated by VIYI Algo. In order to continue to satisfy Nasdaq Stock Market listing standards, at least 3 of the members will be independent in accordance with Nasdaq Listing rules.

In connection with the execution of the merger agreement, and as condition to closing, 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.

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.

The boards of directors for both Venus and VIYI Algo have approved the proposed merger, which is expected to be completed by the end of third quarter of 2021, subject to, among other things, the approval by Venus' shareholders of the merger, the proposed change of name, an increase in the authorized share capital of Venus and satisfaction of the other conditions stated in the definitive agreement and other customary closing conditions, including among other things that the U.S. Securities and Exchange Commission (the "SEC") completes its review of the registration/proxy statement and Nasdaq approves the listing application.